A Look at Profit Margins

Dell: 17.4%
http://www.physorg.com/news185737245.html
http://ycharts.com/companies/DELL/profit_margin


HP: 4.8-10%!
http://uk.reuters.com/article/idUKN2032887120080521
http://www.nytimes.com/2007/05/17/technology/17hewlett.html

Acer: 10%
http://www.chinadaily.com.cn/hkedition/2009-10/23/content_8836046.htm

Apple: 30-35%
http://itmanagement.earthweb.com/co...Apple-Survive-its-Move-Toward-Mass-Market.htm
http://www.engadget.com/2009/10/22/unibody-macbook-late-2009-review/

And then there are the 150% profit margins on screen replacements ($1000 for MBP 15 screen which costs $240 LCD + $100 service)

http://notebookdistrict.com/macbook-pro-15-screen-replacement/

So... I don't think we need these "Is it worth the price?" or "Why so expensive?" or "why can't Apple use the latest hardware?" discussions anymore

 

Apple is part software company too, which has generally higher profit margins than hardware companies. Although they do enjoy high margins on a lot of their hardware products

 

I'm not surprised with HP and Acer, they showed the biggest failure rate in the famous 'outdated' survey, they probably lose most of their profit by repairing the broken things in warantied laptops.
Also, you can see that Dell's strategy by selling directly to the consumer (and bypassing the retailers) is really working for them.

 

The difference in failure rates in that survey between Apple and HP aren't high enough to justify a 30% difference in profit margins which is on a much larger scale, at least in my opinion.

 

Well, we all know they make huge margins, if people are willing to pay it, why shouldn't they try to make money?
Screen replacement pricing is ridiculous though.

 

Google says different. http://www.google.com/finance?q=NASDAQ:AAPL either way, this thread is screaming troll. This also says different. http://royal.pingdom.com/2010/04/09/the-money-made-by-microsoft-apple-and-google-1985-until-today/

 

Excuse me? When other people are making posts questioning the cost, I do some research and you throw the troll card around? I think you may need to review your own conduct.

Your first link does not say anything about profit margins per device. That is company wide. I have specifically looked for profit margins in the notebook manufacturing segment.

Your second link is entirely irrelevant. This is a discussion about profit margins as a ratio, not absolute numbers. In addition, it is comparing notebook hardware manufacturers, not "Microsoft vs Google vs Apple".

I think you need to start treating people with a bit more respect.

As for docvinh: It was never my intent to make this about business ethics. If I set up a lemonade stand and sell lemonades at 500% profit margins (that's my choice), nobody should be criticizing me. However, when people wonder about the cost of the lemonades, I don't have a problem with them discussing my profit margins.

 

Yeah Google and Mircrosoft are software companies, who have higher margins than hardware companies. Apple is sort of both so the numbers aren't surprising.

 

@Seshan;

You're 2nd link is the most ridiculous comparison I think I have ever seen on this forum.

Not only is it comparing Microsoft (SOFTWARE) vs. Apple (HARDWARE), but it fails to discuss the fact that Apple is a stand-alone company while on the other hand Microsoft sales encompass virtually every computer machine that ISNT an Apple (with Windows OS sales).

That's like comparing the sales of Smarties, to all other chocolate bars, and claiming that chocolate bars make much more money than smarties. Complete rubbish.

 

Google vs MS vs Apple, is a better comparison then what you posted, They all do multiple things simulare, Apple doesn't just do hardware, HP,Dell and Acer do.

Microsoft sells software (Windows and other things), they have hardware Xbox, Zune and they do search.

Apple sells hardware Mac's and ipods/iphones, software OS X,iWork, final cut etc.

Google does Search and software Android.

 

Agreed. It all boils down to whether or not the individual can justify the cost that Apple has set (which they are perfectly within their rights to do). If you can't justify the price tag, then move along and stop whining.

I wouldn't put any personal value on a farm tractor, but to some people, that tractor is of phenomenal value, just like to some people a Mac is of higher value than a Windows PC.

To each their own. Learn to stop caring what someone else buys because it doesn't affect you at all.

 

I guess it doesn't really bug me about the profit margins really, I mean, that's the whole reason they're in business. Apple has positioned itself as a premium company, and whether or not it's true, that's the way people see it, therefore, they can charge that bigger premium for their stuff. I think in general, people who purchase Macs seem happy, so I guess everyone wins.

 

Your anti-discussion mentality is rather incompatible for a public forum, don't you think? So far, all the posts by you that I have read which are in response to others' opinion with which you may not agree is, "just shut up and leave".

According to Wikipedia:

In Internet slang, a troll is someone who posts inflammatory, extraneous, or off-topic messages in an online community, such as an online discussion forum, chat room or blog, with the primary intent of provoking other users into an emotional response[1] or of otherwise disrupting normal on-topic discussion.[2]

I do not believe that my research results (and I gave multiple links for each figure stated) are 1) emotionally charged with the primary intent of provoking emotional response, or 2) disrupting an on-topic discussion. If you find yourself having an emotional response when discussing technology, it may be time for you to step away from this discussion.

@Seshan: In case you have missed it the last time I emphasized an important point, here it is again: I looked specifically for figures that deal with notebooks. It is a known fact that the iPhone gives a 60% profit margin, but I did not include that kind of thing in the figures I posted. All other entities used in the comparison are departments concerned with notebook manufacturing. I have yet to see a Microsoft or Google branded notebook.

 

I don't see a part that says "profit margins for notebooks" in here http://finapps.forbes.com/finapps/jsp/finance/compinfo/Ratios.jsp?tkr=AAPL

 

I agree. Sorry, bad link. Let me replace that one:

http://itmanagement.earthweb.com/co...Apple-Survive-its-Move-Toward-Mass-Market.htm

Excerpt: For years now, Apple has commanded a market position that big PC OEMs such as HP or Dell could only dream of pulling in. Apple’s user market share might still be struggling to hit 10 per cent, but nevertheless it manages to pull in an average profit margin of 30 to 35 per cent across its product lines.


Nonetheless, I hope that we can have a civilized discussion on this forum. However, I will assure you that I have no interest in a yelling match where parties accuse one another of "trolling", even if it is only unilateral at this point.

 

The vast majority of MSFT's revenue is Office, Exchange, and Server licenses. OEM's don't pay all that much for Windows. So yeah...Microsoft is a software company.


http://www.businessinsider.com/chart-of-the-day-microsoft-operating-income-by-division-2010-2

Google Android is free and the 30% cut off revenues from the store go to the network provider. Android is not a revenue driver...Google Docs on the other hand is but a tiny chunk of revenue compared to their ad driven stuff.

HP has over $40B of its $120B+ revenue coming from its services/consulting lines so it's not a great comparison either. Manpower is very expensive and not scalable compared to a software license. It does over 24B/yr in revenue just on printers/cameras. Dell is the closest to a publicly traded pure play around and even they've moved toward corporate services by buying Perot.

 

Again, I fail to see the part for just notebooks.

 

The term "across its lines" tends to encompass all products by a company.

 

Yeah, exactly, I thought you where looking for profit margins for notebooks, not hardware and software.

 

So on the point it can't possibly be moreso.....

You should just copy and paste that where applicable.

 

This thread is closed since it has turned into a flame war.