Mini-Strategy - Powerpoint

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Apple Mini-Strategy

STR/581

Lisa Diesel

Ashley Rhoden, Shyesta Kennedy, Lindsey Atkinson, Teri Nichols, Brian Lilley, Qiana Reynolds

Apple’s Mission and Vision

Apple Inc. Mission Statement: “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.” (The Balance)

Apple Inc. Vision Statement: “We believe that we are on the face of the earth to make great products and that’s not changing. We are constantly focusing on innovating. We believe in the simple not the complex. We believe that we need to own and control the primary technologies behind the products that we make, and participate only in markets where we can make a significant contribution. We believe in saying no to thousands of projects, so that we can really focus on the few that are truly important and meaningful to us. We believe in deep collaboration and cross-pollination of our groups, which allow us to innovate in a way that others cannot. And frankly, we don’t settle for anything less than excellence in every group in the company, and we have the self- honesty to admit when we’re wrong and the courage to change. And I think regardless of who is in what job those values are so embedded in this company that Apple will do extremely well.” (Panmore)

Apple’s Mission statement has been changing over the years as the company has evolved from making computers to several different lifestyle products. The mission statement is very specific about what the company is doing and will continue to do within their organization. The mission statement includes the different products that they will provide and continue to improve for their consumers. The mission statement also discusses the goals for the company.

Apple’s Vision statement is quite comprehensive. It includes details about the approach they will take to ensure continued growth for the business.

Apple Value’s

Empathy for Customers/Users

Aggressiveness/Achievement

Positive Social Contribution

Innovation/Vision

Individual Performance

Team Spirit

Quality/Excellence

Individual Reward

Good management

(Values)

Apple Inc’s Objectives

To create groundbreaking products to deliver to consumers.

To innovate and create new products that dictate the future of technology

Gain market share while sustaining premium pricing

Increase Profit Margins

Sustain and expand on strongly branded name

Build hype and anticipation for new upcoming products

Leadership Team

Tim Cook Angela Ahrends Eddy Cue Craig Federighi

CEO Senior Vice President Retail Senior Vice President Internet software and services Senior Vice President Software Engineering

Johnathan Ive Luca Maestri Dan Riccio Philip W. Schiller Senior Vice

Chief Design Officer SVP Chief financial officer SVP Hardware Engineering President Worldwide Marketing

With all the leadership there is total of 18 who help keep Apple Inc operating that way it needs to be run., From the CEO to the Vice President of Worldwide Human Resources .

Tim Cook is the CEO of the Apple Inc and he makes sure that all the new products that go out are products that apple can be proud of . Apple leader makes sure that all products are tested and work before it leaves the warehouse. All of Apple leader has there parts that they need to do with internet, retail, operation, design everyone has to make sure that there part is ready before the next person can take over and finish there section. In order for new phones and apps to come out hey have to pass all the aspects of limits that they work and not have any problems. All new products are okay through Tim Cook.

Board members / Employees

Apple Board members who help run this Company

Board of Directors

Albert Gore Jr .Former Vice President of the United States

Robert A. Iger Chairman and CEO The Walt Disney Company

Andrea Jung President and CEO Grameen America, Inc.

Arthur D. Levinson, Ph. D.Chairman of the Board, Apple Former Chairman and CEO Genentech

James A. Bell Former CFO and Corporate President The Boeing Company

Tim Cook CEO Apple

Ronald D. Sugar, Ph. D .Former Chairman and CEO Northrop Grumman

There are Currently 115,000 employees at Apple that make sure your phones are working I the best way., and selling hem in all the Apple stores .

Board member , employees and structure all fall in the same part together. In order for new products to hit the market all the board members agree on what product and once they have done that then it fall to the next group to work on that design with them working woth the other departments of opertation to make sure that everything is working the way it needs to in order to hit the market at the right time frame.. Now if something does hit the market and its not right or the products does something that it should not they then need to answer to the CEO Tim Cook and if he doesn’t get the answer he wants to hear then someone is in trouble and he pulls everyone into the board room to ask questions and get the answers he need to why something is not working correctly.

5 Year Financials: Income Statement

Revenue

Per Guru Focus (2017), Apple Inc's revenue for the three months ended in Mar. 2017 was $52,896 (USD) million. For the trailing twelve months (TTM) ended in Mar. 2017 the firm’s revenue was $220,457 (USD) million. Apple Inc's revenue per share for the three months ended in Mar. 2017 was $10.05 (USD). Its revenue per share for the trailing twelve months (TTM) ended in Mar. 2017 was $41.02 (USD).

Morningstar (2017) reports Apple Inc’s 5-Year revenue and Net Income:

2012: $156,508; $41,733

2013: $170,910; $37,037

2014: $182,795; $39,510

2015: $566,715; $53,397

2016: $215,639; $45,687

Revenue Per Share

Per GuruFocus (2017.-a), for the past 12 months, the average Revenue per Share Growth Rate of the firm was 2.10 percent per year; the past 3 years, the average was 14.40 percent per year; and during the past 5 years, the average was 18.90 percent per year. Based on these percentages, the firm’s revenue growth has slowed down over the past twelve months.

References:

GuruFocus. (2017). Apple, Inc. Revenue. Retrieved from https://www.gurufocus.com/term/Revenue/NAS:AAPL/Revenue/Apple-Inc

GuruFocus. (2017.-a). Apple, Inc. Revenue Per Share. Retrieved from https://www.gurufocus.com/term/per%20share%20rev/NAS:AAPL/Revenue%2Bper%2BShare/Apple%2BInc

Morningstar. (2017). Apple Inc AAPL: Financials. Retrieved on May, 13, 2017, from http://library.morningstar.com.contentproxy.phoenix.edu/stock/financials/income-statement?t=AAPL&region=USA&culture=USA

5 Year Financials: Balance Sheet

Total Assets:

Total Current Assets is linked to the Current Ratio, which is the result of dividing total current assets by total current liabilities. It is frequently used as an indicator of a company's liquidity, its ability to meet short-term obligations. Apple Inc's total assets for the quarter that ended in Mar. 2017 was $334,532 million USD. For the trailing twelve months (TTM) ended in Mar. 2017 , its average Total Assets Growth Rate was 7.00 percent per year; totaling $321,686. During the past 3 years, the average Total Assets Growth Rate was 15.20 percent per year; during the past 5 years, the average Total Assets Growth Rate was 22.00 percent per year (Gurufocus, 2017.-b).

References:

GuruFocus. (2017.-b). Apple, Inc. Total Assets. Retrieved from https://www.gurufocus.com/term/Total+Assets/NAS:AAPL/Total-Assets/Apple-Inc

5 Year Financials: Balance Sheet (con’t)

Total Liabilities

Total liabilities are the liabilities that the company has to pay others. It is a part of the balance sheet of a company that shareholders do not own, and would be obligated to pay back if the company liquidated. Apple Inc's total liabilities for the quarter that ended in Mar. 2017 was $200,450 million (USD).

Its quarterly total liabilities increased from $193,437.00 million in Sep. 2016 to $198,751.00 million in Dec. 2016 and increased from $198,751.00 million in Dec. 2016 to $200,450.00 million in Mar. 2017.

The firm’s annual total liabilities increased from 120,292.00 million in Sep. 2014 to $170,990.00 million in Sep. 2015 and increased from $170,990.00 million in Sep. 2015 to $193,437.00 million in Sep. 2016.

Total Equity

Apple Inc's total equity for the quarter that ended in Mar. 2017 was $134,082 million (USD); its Total Equity for the fiscal year that ended in Sep. 2016 is $128,249 (GuruFocus, 2017.-d).

Total equity is used to calculate book value per share. The firm’s book value per share for the quarter that ended in Mar. 2017 was $25.76 (USD); shares outstanding were 5,206. Apple Inc's Book Value Per Share for the fiscal year that ended in Sep. 2016 was 24.03; shares outstanding were 5,336. During the past 12 months, the firms average Book Value Per Share Growth Rate was 8.20 percent per year (GuruFocus, 2017.-d).

[Book value: (Total Equity – Preferred Stock)/Shares Outstanding]

During the past 3 years, the average Book Value Per Share Growth Rate was 7.00 percent per year. During the past 5 years, the average Book Value Per Share Growth Rate was 12.30 percent per year (GuruFocus, 2017.-d).

The ratio of a company’s debt over equity can be used to measure how leveraged this company is. Apple Inc's debt to equity ratio for the quarter that ended in Mar. 2017 was 0.73. The firms Debt to Equity Ratio for the fiscal year that ended in Sep. 2016 is 0.68 (GuruFocus, 2017.-d).

References:

GuruFocus. (2017.-c). Apple, Inc. Total Liabilities. Retrieved from https://www.gurufocus.com/term/Total+Liabilities/NAS:AAPL/Total-Liabilities/Apple-Inc

GuruFocus. (2017.-d). Apple, Inc. Total Equity. Retrieved from https://www.gurufocus.com/term/Total+Equity/NAS:AAPL/Total-Equity/Apple-Inc

5 Year Financials: Cash Flows

Cash Flow from Operations

Cash flow from operations refers to the cash brought in through a firm’s normal business operations. It is the cash flow before any investment or financing activities. It is the cash version of net income (GuruFocus, 2017.-e).

Apple, Inc’s Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2017 was $66,339 (USD). Its Cash Flow from Operations for the fiscal year that ended in Sep. 2016 is $65,824 (GuruFocus, 2017.-e).

Cash Flow from Investing

Cash Flow from Investing covers the cash a company gains or spends from investment activities in financial market and operating subsidiaries. It also includes the cash the company used for property, plant and equipment (PPE) (GuruFocus, 2017.-f).

Apple Inc Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2017 was -$45,191 (USD). Its Cash Flow from Investing for the fiscal year that ended in Sep. 2016 was -$45,977 (GuruFocus, 2017.-f).

References

GuruFocus. (2017.-e). Apple, Inc. Cash Flow from Operations. Retrieved from https://www.gurufocus.com/term/Cash+Flow+from+Operations/NAS:AAPL/Cash-Flow-from-Operations/Apple-Inc

GuruFocus. (2017.-f). Apple, Inc. Cash Flow from Investing. Retrieved https://www.gurufocus.com/term/Cash+Flow+from+Investing/NAS:AAPL/Cash-Flow-from-Investing/Apple-Inc

5 Year Financials: Cash Flows (con’t)

Cash Flows from Financing

Cash from financing is the cash generated/spent from financial activities such as share issuance (buy back), debt issuance (repayment), and dividends paid to preferred and common stockholders (GuruFocus, 2017.-g).

Apple Inc Cash Flow from Financing for the trailing twelve months (TTM) ended in Mar. 2017 was -$27,505. The firm’s Cash from Financing for the fiscal year that ended in Sep. 2016 -$20,483 (GuruFocus, 2017.-g).

Net Change in Cash

Net change in cash is calculated as the total of cash flow from operations, cash flow from investing, cash flow from financing, and some other items (GuruFocus, 2017.-h).

Apple Inc's net change in cash for the three months ended in Mar. 2017 was -$1,214 million (USD). Its net change in cash for the trailing twelve months (TTM) ended in Mar. 2017 was -$6,357 million. The firm’s Net Change in Cash for the fiscal year that ended in Sep. 2016 was -$616 million (GuruFocus, 2017.-h).

Free Cash Flow

Apple Inc's total free cash flow for the three months ended in Mar. 2017 was $9,508 million. Its total free cash flow for the trailing twelve months (TTM) ended in Mar. 2017 was $52,961 million (GuruFocus, 2017.-i).

During the past 3 years, the average Free Cash Flow per Share Growth Rate was 11.60 percent per year. During the past 5 years, the average Free Cash Flow per Share Growth Rate was 18.00 percent per year (GuruFocus, 2017.-i).

References

GuruFocus. (2017.-g). Apple, Inc. Cash Flow from Financing. Retrieved from https://www.gurufocus.com/term/Cash+from+Financing/NAS:AAPL/Cash-Flow-from-Financing/Apple-Inc

GuruFocus. (2017.-h). Apple, Inc. Net Change in Cash. Retrieved fromhttps://www.gurufocus.com/term/Net+Change+in+Cash/NAS:AAPL/Net-Change-in-Cash/Apple-Inc

GuruFocus. (2017.-i). Apple, Inc. Free Cash Flow. Retrieved from https://www.gurufocus.com/term/total_freecashflow/NAS:AAPL/Free-Cash-Flow/Apple-Inc

5-Year Financials: Stock Prices

Stock Prices:

Per Morningstar (2017). Apple, Inc’s Year-End (High/Low)Stock Prices reflect:

2012: $100.72/$57.86

2013: $82.16/$55.01

2014: $119.75/$70.51 (Apple Stock Split date: June9, 2014; split ratio 7-for1)

2015: $134.54/$92.00

2016: $118.69/$89.47

Year-to-Date: $154.88/$114.76

Current Stock Price, Closing Stock Price, and 52 Week High

The firm’s current stock price as of May 12, 2017; 4:00pm EST reflects: $156.10 per share. Its five day closing stock price (May 8 through May 12, 2017) is $156.11. The 52 Week High or highest price for Apple’s stock over the past year is $154.88; its lowest is $89.47 (Morningstar, 2017).

Sparks (2017) stated, "In the past two years, Apple’s stock has only outperformed the S&P 500 when including dividends by about four percentage points but, investors shouldn't mistake this modest outperformance as an indication of the stock's long-term return" (para. 1). After adjusting for stock splits, Apple’s stock has dominated the market with a 59 percent for a 5-year return.

References

Sparks, D. (2017). Apple’s Stock Split History. Retrieved from https://www.fool.com/investing/2016/08/10/apples-stock-split-history.aspx

CEO: Tim Cook

Born November 1, 1960 in Robertsdale, Alabama

Father: Donald Cook – Shipyard Worker

Mother: Geraldine Cook – Stay-At-Home Mother

Never married; No Children

1982 – Graduated from Auburn University with a Bachelor’s Degree in Industrial Engineering

1988 – Graduated from Duke University’s Fuqua School of Business with an MBA

2015 – Received Honorary Doctorate from George Washington University

Tim Cook was born in the small town of Robertsdale, Alabama on November 1, 1960. Growing up, his father, Donald worked as a shipyard worker and his mother stayed home to raise him and his two brothers. When Tim was young, he used to deliver newspapers around his hometown and to this day, his parents, still live in the same house in which he was raised ("Tim Cook: 20 Fun Facts," 2017). Tim Cook never married himself, nor does he have any children. Tim graduated from Auburn University, earning his Bachelor’s Degree in Industrial Engineering in 1982 and moved on to earn his Master’s in Business Administration from Duke University’s Fuqua School of Business in 1988 and earned the recognition as the Fuqua Scholar (graduated within the top ten percent of his class). In 2015, he received an Honorary Doctorate from George Washington University.

Work History:

IBM (12 years)

Intelligent Electronics (3 years)

Compaq

Apple Inc

Current Position

CEO, Apple Inc

(August 24, 2011- Present)

Upon graduating with his Master’s Degree, Tim Cook accepted a position working for IBM and in 1994 became the company’s North American Fulfillment director. After 12 years with IBM, in 1994 Tim Cook moved on to work for Intelligent Electronics as their Chief Operating Officer, working there for 3 years before accepting appointment as Vice President of Corporate Materials at Compaq Computer Corporation. However, only months later, Apple Inc’s CEO, Steve Jobs called him for an interview. Against the advice of his friends, due to the uncertainty of Apple’s future, Tim Cook was impressed by Steve Jobs and accepted the position of Senior Vice President of Worldwide Operations in 1998. Cook was responsible for managing sales and operations worldwide and after only a year of being with the company, Apply noticed a rise in profits after reportedly suffering heavy losses from prior years. Gaining back it’s corporate image, Cook was promoted to Chief Operating Officer in January 2007 and served as CEO when Steve Jobs took a leave of absence in 2009 to manage his health ("Tim Cook Biography - Childhood, Life Achievements & Timeline," 2017). Unable to perform the tasks required of CEO, Steve Jobs resigned and named Tim Cook as CEO of Apple Inc. on August 24, 2011.

Conclusion

References

GuruFocus. (2017). Apple, Inc. Revenue. Retrieved from https://www.gurufocus.com/term/Revenue/NAS:AAPL/Revenue/Apple-Inc

GuruFocus. (2017.-a). Apple, Inc. Revenue Per Share. Retrieved from https://www.gurufocus.com/term/per%20share%20rev/NAS:AAPL/Revenue%2Bper%2BShare/Apple%2BInc

GuruFocus. (2017.-b). Apple, Inc. Total Assets. Retrieved from https://www.gurufocus.com/term/Total+Assets/NAS:AAPL/Total-Assets/Apple-Inc

GuruFocus. (2017.-c). Apple, Inc. Total Liabilities. Retrieved from https://www.gurufocus.com/term/Total+Liabilities/NAS:AAPL/Total-Liabilities/Apple-Inc

GuruFocus. (2017.-d). Apple, Inc. Total Equity. Retrieved from https://www.gurufocus.com/term/Total+Equity/NAS:AAPL/Total-Equity/Apple-Inc

GuruFocus. (2017.-e). Apple, Inc. Cash Flow from Operations. Retrieved from https://www.gurufocus.com/term/Cash+Flow+from+Operations/NAS:AAPL/Cash-Flow-from-Operations/Apple-Inc

GuruFocus. (2017.-f). Apple, Inc. Cash Flow from Investing. Retrieved https://www.gurufocus.com/term/Cash+Flow+from+Investing/NAS:AAPL/Cash-Flow-from-Investing/Apple-Inc

References

GuruFocus. (2017.-g). Apple, Inc. Cash Flow from Financing. Retrieved https://www.gurufocus.com/term/Cash+from+Financing/NAS:AAPL/Cash-Flow-from-Financing/Apple-Inc

GuruFocus. (2017.-h). Apple, Inc. Net Change in Cash. Retrieved from https://www.gurufocus.com/term/Net+Change+in+Cash/NAS:AAPL/Net-Change-in-Cash/Apple-Inc

GuruFocus. (2017.-i). Apple, Inc. Free Cash Flow. Retrieved from https://www.gurufocus.com/term/total_freecashflow/NAS:AAPL/Free-Cash-Flow/Apple-Inc

Sparks, D. (2017). Apple’s Stock Split History. Retrieved from https://www.fool.com/investing/2016/08/10/apples-stock-split-history.aspx

References

Hangen, Nathan. “7 Key Strategies That You Must Learn From Apple’s Marketing.”

Johnson-Bryant, Radiah. “Apple Marketing Plan.” Google Sites. Web. 21 Jun. 2015.

(Panmore) Apple’s Vision Statement, retrieved from: http://panmore.com/apple-mission-statement-vision-statement

(The Balance) What is Apples Mission Statement? Retrieved from: https://www.thebalance.com/apple-mission-statement-4068547

Tim Cook Biography - Childhood, Life Achievements & Timeline. (2017). Retrieved from http://www.thefamouspeople.com/profiles/tim-cook-6713.php

Tim Cook: 20 Fun Facts. (2017). Retrieved from www.celebrityfunfacts.com/tim-cook/tim-cook-20-fun-facts/

(Values) Apple Employee Handbook retrieved from: http://www.seanet.com/~jonpugh/applevalues.html