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Case Study Component 1
Team A5
Tonya Berry, Tyshon Johnson, Courtney Murray, Tondra Sneed
Grand Canyon University
Course: FIN-504-0501
Finance Principles
Date Submitted: 11/14/2023
Instructor: Japheth Kessio
2
Introduction
Apple is a multinational technology company based in Cupertino, California and American manufacturer of personal computer software. Apple is the world’s biggest company by
marketing capitalization at a record $3 trillion in market value. Apple focuses less on acquiring new customers through price, instead focuses on customer retention by offering outstanding customer experiences. Fundamental disciplines form the foundation of Apple's excellent marketing. Apple bases its product design on the idea that less is more. They avoid providing an excessive number of options, choices, or even restrictions to their intended clientele. Apple keeps
its marketing and graphics straightforward as its products speak for itself. Goals & Strategies
Apple operates in aggressively competitive markets. It faces challenges from Samsung, Google, and Huawei, who regularly introduce new products and technologies. Apple must continuously offer unique value to remain competitive. Apple's goal is to provide the best user experience through innovative hardware, software, and services while striving to leave the world better than they found it. (Abbott, 2023). Apple prioritizes exceptional product development over
market expansion. This strategy creates profitable technology products to boost market share and
performance. (Meyer, 2023). Apple's success is driven by its innovative research and development processes. According to Meyer (2023), Apple's competitive strategy aims at broad differentiation and emphasizes the creation of unique features that distinguish the company and its products from its competitors.
3
This strategy requires the company to create profitable and attractive technology products
to increase its market share and business performance while exceeding customer expectations. The company's intensive growth strategies align with its generic competitive strategy, which is focused on product innovation. The company competes with IT and consumer electronics firms, including Samsung, Google, and Microsoft. (Meyer, 2023).
Revenue Outlook
The tech giant Apple Inc. reported $383.29 billion in sales for the full fiscal year which is
down about 3% from the previous year (Kif, 2023). Apple’s underperformance in Q4 was based on expectations of the new iPhone launch which was forecasted to bring more revenue than it has. Though stock prices were set to drop, Apple remains to have a successful year as most targets have been met in Q1-Q4 regarding overall revenue achieved. The following chart displays Apple Inc. annual revenue history that includes the present growth rate of –2.8% from the previous year at a loss of 11.04 billion by end of fiscal year September 30, 2023. Figure 1.0 Apple Inc. 10 Year Annual Revenue
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Data collected to measure revenue history was collected from Stock Analysis
A cross-sectional analysis has been prepared to determine the company’s performance within the computer and technology sector. A cross-sectional analysis entails the comparison of various firm's financial ratios simultaneously (Zutter, et al., 2019). According to research from cross-sectional analysis, Apple has the greatest return on common equity at almost 172% which indicates exceptional financial performance and profits from investment decisions.
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Revenue projections are an estimate of how much a company will generate over a set period (How to Calculate Revenue Projections (With Examples), 2023). Using research data, an educated prediction of Apple’s future revenue within the next year can be concluded that Apple will generate revenue at an increase rate of 5% or greater. Apple’s market capitalization of $2.7 trillion is an indicator of the company’s perceived value. One key driver in Apple’s predicted increase is in sales of the iPhone which represents 48.95% of all products sold. Through innovation strategies Apple has the potential to remain the largest company in the world while it
continues to increase stockholders' wealth through effective investment activities. References
Abbott, A. (2023, March 2). Apple mission statement, vision, & core values (2023)
. Business Strategy Hub. https://bstrategyhub.com/apple-mission-statement-vision-core-values/
Alphabet Inc. GOOG (US: Nasdaq) (2023). Financials. WSJ Market. Retrieved from https://www.wsj.com/market-data/quotes/GOOGL/financials
Apple. (2023, October 10). Apple reports first quarter results. Apple Newsroom
. https://www.apple.com/newsroom/2023/02/apple-reports-first-quarter-results/
Apple Inc.AAPL (US.: Nasdaq) (2023) Financials. WSJ Market. Retrieved from https://www.wsj.com/market-data/quotes/AAPL/financials
Apple Revenue. (2023) Apple Inc. (AAPL). Stock Analysis. Retrieved from https://stockanalysis.com/stocks/aapl/revenue/
David, C., (2023) Apple Statistics (2023). Business of Apps. Retrieved from https://www.businessofapps.com/data/apple-statistics/
Dell Technologies DELL Inc. CI C (US.: NYSE) (2023) Financials. WSJ Market. Retrieved from https://www.wsj.com/market-data/quotes/DELL/financials
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How to Calculate Revenue Projections (With Examples), (2023) Indeed. Retrieved from https://www.indeed.com/career-advice/career-development/revenue-projections
International Business Machines Corp. IBM (US.:NYSE) (2023) Retrieved from https://www.wsj.com/market-data/quotes/IBM/financials
Keith, S. (2023) Prediction: How Much will Apple be Worth in 2030. The Motley Fool. Retrieved from
https://www.nasdaq.com/articles/prediction:-heres-how-much-apple-will-
be-worth-in-2030
Kif, L., (2023) Apple stock dips after weak outlook for December quarter revenue. CNBC. Retrieved from
https://www.indeed.com/career-advice/career-development/revenue-
projections
Leswing, K. (2023, November 2). Apple stock dips after weak outlook for December quarter revenue. CNBC. https://www.cnbc.com/2023/11/02/apple-aapl-earnings-report-q4-
2023.html
Microsoft Corp. MST (US.:Nasdaq) (2023) Financial. WSJ Market. Retrieved from https://www.wsj.com/market-data/quotes/AAPL/financials
Meyer, P. (2023, October 24). Apple’s generic competitive strategy & growth strategies
. Panmore Institute. https://panmore.com/apple-inc-generic-strategy-intensive-growth-
strategies
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