Thursday, January 24, 2013

Apple CEO to investors: Ignore the rumors

Apple's Q1 2013 earnings report is out, and it has been another strong quarter for the Cupertino giant. But there have been reports suggesting that Apple has made significant component order cuts, a move which may indicate that the iOS juggernaut could be stalling. However, Apple CEO Tim Cook is advising investors to be cautious about putting too much stock into the rumor mill.
During yesterday's earnings call with investors and analysts, Cook took time to address the rumor mill.
"I want to take a moment and make a comment," Cook said. "I don’t want to comment on any particular rumor, but I’d question the accuracy of any kind of rumor about our plans. I’d stress that even if a particular data point were factual, it would be impossible to interpret [what this means] for our overall business."
He went on to say that "yields can vary, supplier performance can vary" and that "there’s an inordinately long list of things that would make any single data point not a great proxy for what’s going on."
In other words, take what you hear with a pinch of salt, because even if the information is true, when it is taken out of the context of the business as a whole, it's impossible to know what it means.
I agree with this, and said as much when I covered the initial rumor last week. What bothered me about the report was the total lack of concrete figures. Without context, the report was virtually meaningless.
Cook also went on to dismiss the need for a cheaper iPhone. When asked whether Apple was considering a cut-priced iPhone, he said that the company was "not interested in revenue for revenues’ sake" and that the company "could put the Apple brand on a lot more stuff, but we don’t want to do that."
Revenues, cash in the back, and customer satisfaction suggests that Apple is doing a fine job of running Apple.

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