Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Why Apple’s Mac Sales Won’t Stir the Pot

Apple Inc. (NASDAQ: AAPL) has been dominating the PC market ever since its MacBook appeared. That was 7 and a half years ago and since then, Apple’s market share has grown by an astonishing 150%, simply blazing through the competition and for the most part landing on its feet. By now, pretty much everyone knows their secret to success: sleek designs with technological innovation, and a systematic distinction from the PC crowd. But the Mac sales which once considerably outgrew the industry, have been slowly climbing back down the success stairs and are almost touching the ground.

Apple Inc (AAPL)

So, what is happening with Mac sales and more importantly, does Apple’s CEO Tim Cook even care?

When you’re up, you can always come down

Part of Apple Inc. (NASDAQ:AAPL)’s confidence as a tech company comes from its constant and steady sales, which in barely 8 years accomplished a 272% revenue increase. Now, this doesn’t mean that Apple is untouchable market-wise. Indeed, I’m sure most of you will remember the 22% drop in sales back in 2011 when our tech favourite failed to deliver enough of the newest iMacs to meet our demand. Well, Apple sure felt the heat, but it didn’t even sweat. Because by 2011 we already had the options of acquiring iPads, in order to substitute our immediate Mac needs.

Halos never fade

Now to get some perspective, let’s see how Apple Inc. (NASDAQ:AAPL) is looking on the market. The Mac sales have generated $21.5 billion in income, which represents 13% of all Apple sales. Also, Mac cashes out big in the overall PC market, where Apple’s profits take nearly half the cake. However, the bigger issue is the 20% drop in Mac sales that the tech giant has been exposed to. According to Charlie Wolf of Needham & Co, this is due to the fading halo effect. This means that Apple Inc. (NASDAQ: AAPL) once benefited from Windows users, who discovered the Apple Store through the iPod, iPhone or iPad, but now the thrill is now gone. The iPad dominance is probably causing customers to come into the shop wanting a Mac, and leaving with a new iPad air instead.

Prices lead the market

So, if iPad sales are replacing Mac sales, instead of impacting PC sales, wouldn’t that just leave Apple Inc. (NASDAQ: AAPL) more room to play on the phone and tablet market? Maybe, but then sales will still be a question of price. While Mac’s are cheaper today than ever, they’ve become much pricier than average PC’s. And this would affect the overall revenue, if it weren’t for Apple’s intangible asset: its brand name. So even if prices keep rising, like with the iPhone 6, Apple fans are bound to still buy the products because of what they represent.

Disclosure: none

Recommended Reading:

Is the iPhone 5C Not Selling Enough?

Finally! Google Inc (GOOG) Focuses on Getting Better Pics!

Carl Icahn’s New 13F Confirms What We Already Knew: He Likes Energy, Loves Apple

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!