[HN Gopher] Apple reports Q3 results
___________________________________________________________________
Apple reports Q3 results
Author : danceparty
Score : 123 points
Date : 2020-07-30 20:37 UTC (2 hours ago)
(HTM) web link (www.apple.com)
(TXT) w3m dump (www.apple.com)
| tqi wrote:
| Apple, Alphabet, Amazon, and Facebook, which combined are worth
| almost $5 trillion dollars[1] all releasing earnings on the same
| day seems crazy. From what I could find, that is 14% (5T/35T) of
| the total stock market posting earnings on the same day [2].
|
| I'm curious if anyone has thoughts on what effect that has on the
| overall market in terms of volatility? (I really have no good
| idea as to how any of this works) Could we see other stocks
| dip/rise as money is reallocated?
|
| [1] https://www.cnbc.com/2020/07/29/big-tech-including-apple-
| and... [2] https://siblisresearch.com/data/us-stock-market-value/
| totalZero wrote:
| There's a concept in the options trading world called
| "correlation skew," which describes how tail risk for baskets
| like SPY/QQQ/XLK can trade richer than tail risk for the basket
| components, based on how much correlation there is expected to
| be in the components. When correlation is expensive, you can
| buy option contracts on the basket components and sell
| contracts on the basket itself, to set up a position that
| profits when the basket components exhibit dispersion rather
| than correlation.
|
| Sure, we could see sector rotation into tech tomorrow. This may
| be somewhat muted because tech is already a very crowded trade,
| and tech names are already trading far higher than where they
| closed.
| akmarinov wrote:
| Somehow only Alphabet had a decline in revenue...
| glglwty wrote:
| Vix doesn't seem to move much this week
| nojito wrote:
| Market cap is an irrelevant measure. It's simply the price of
| the last sold share * number of shares outstanding.
| throwaway5792 wrote:
| Why is that irrelevant?
| cblconfederate wrote:
| There is only so many trillions to be invested in stocks
| (because, where else?), and they have already been invested.
| Stock markets have for so long had a totally irrational
| relationship with day-to-day news, that they probably won't
| move the needle much.
| sf_rob wrote:
| Market cap is set by marginal prices, so supply of uninvested
| capital isn't super relevant and might even increase
| volatility due to lower liquidity.
| Wohlf wrote:
| First and foremost, the stock market is not the economy.
| Second, stocks are primarily traded on their expected future
| value, not current profits, hence why companies like Tesla
| have a price to earnings ratio that is absurd.
| nutshell89 wrote:
| I guess this is the biggest argument for breaking up the tech
| giants - not only are there clear examples of each company
| either abusing public trust or using their size in anti-
| competitive ways, but their wealth shields them from having to
| meaningfully engage with the public at large or reign in said
| behavior.
| mathattack wrote:
| The timing is based on quarter end dates. There's a season of a
| few days each quarter when everyone on a standard calendar
| reports. Similar companies move together on the assumption of
| "if Walmart has good earnings, Target should too"
| JoshTko wrote:
| Really unexpected that YOY revenue is up for Mac 22% and iPad
| 31%. Also unexpected that service revenue growth seems to have
| slowed.
| adtac wrote:
| >The Board of Directors has also approved a four-for-one stock
| split to make the stock more accessible to a broader base of
| investors. Each Apple shareholder of record at the close of
| business on August 24, 2020 will receive three additional shares
| for every share held on the record date, and trading will begin
| on a split-adjusted basis on August 31, 2020.
| crazygringo wrote:
| I'm curious. Do trading platforms automatically adjust existing
| limit orders the night of August 24, e.g. dividing all prices
| by 4? (Or just cancel all limit orders?)
|
| I mean I would assume they do, but just wonder if there are
| ever any severe "gotchas" with a stock split with certain
| existing buy/sell arrangements, or derivatives etc.
| marvin wrote:
| I haven't worked on trading systems in the US, but handling
| this type of gotcha is the bread and butter of the sort of
| trading software I _have_ been working on.
|
| There's a million tiny details like this that can cause
| consequences that are both different from what a customer
| intended and what our terms with said customer states, so
| making sure it's all handled in a safe way is just part of
| daily business.
| bollockitis wrote:
| I can't imagine working on software that could have such
| potentially disastrous financial consequences, so kudos to
| you and all of the developers who do this kind of work.
| chollida1 wrote:
| Exchanges automatically cancel out GTC and GTD orders when
| splits occur.
|
| Options are also split to take the stock split into account.
|
| Trading platforms shouldn't have to do anything unless they
| are faking GTC orders by resending them out each day as Day
| orders.
|
| But if your vendor is doing that then, get a new vendor as
| that's completely bush league.
| meddlepal wrote:
| What's the split price? $Close / 4?
| anthony_r wrote:
| There is no such thing as "split price". You get 4 shares for
| each share you previously owned, and it's up to the market to
| resume trading at a new level. It's a non-event, really,
| except it makes some operations easier.
| 3pt14159 wrote:
| Yeah, it was getting a bit pricy to buy lots of 100 apple
| shares at a time and sell covered calls. This is much
| better. Honestly I think selling covered call on Apple is
| one of the few good plays left out there. Long term the
| company's value is going to keep going up, but with so much
| volatility in the market lately option premiums are bananas
| and though I expect a pretty dramatic stock market pullback
| Apple is one of the few companies that has very strong
| fundamentals and should weather it pretty well.
| anthony_r wrote:
| Ah yes, selling volatility via covered calls. The
| institutional investors' second favourite way of
| collecting "extra income" in the zero rates world, second
| only to explicit leverage.
|
| Some of them sold much more volatility, via variance
| swaps, with quite disastrous results.
|
| https://www.institutionalinvestor.com/article/b1lffwvwdh7
| xtq...
| 3pt14159 wrote:
| I mean, my family's investment company is far, far from
| being an institutional investor, but the math is pretty
| solid. If our plan is to buy Apple and sell it in the
| next six months if it rises by 15% then it is pretty easy
| to justify selling the calls with a strike at 15%, which
| I know isn't perfect because if something substantial
| changes at Apple (a new product, say) then in the case
| where the calls weren't sold you could re-evaluate your
| target, but that type of event doesn't happen too
| frequently and if we would have put a sell order at 15%
| above anyway it's a near-free increase in returns.
| Because inflation eats the first couple percentage points
| and taxes don't take that into account the delta in gains
| does stack up over time.
|
| Selling puts, though, is a fools game unless the market
| has already really tanked. Black Scholes isn't perfect,
| yadda, yadda.
| eaenki wrote:
| It will never cease to amaze me. LTMC is my favorite
| story
| sbierwagen wrote:
| LTCM _
| dastbe wrote:
| Possibly, but its really however the market prices it.
|
| For example, if the theory goes that more people will want to
| buy apple now that the price is a "steal" (people think it's
| harder to 2x a big number than a small number) then it could
| go above that on open.
| anthony_r wrote:
| Bitcoin and Bitcoin Cash ?
|
| I prefer to believe that stocks are not in a bubble of such
| epic proportions that a stupid split can be an "event".
| johannes1234321 wrote:
| > Bitcoin and Bitcoin Cash ?
|
| That is the split of Google A and C some years back,
| where Google added a new class of shares with different
| voting power.
|
| In the Apple split each share after the split will be
| worth 1/4th, have 1/4th voting power, will receive 1/4th
| of dividend, etc. just reading happens in smaller
| fractions.
| cercatrova wrote:
| Are stock splits necessary now that many brokerages have
| fractional shares? It seems the true metric is percentage
| gained or lost rather than the price.
| cj wrote:
| One thing to note is stock price dramatically impacts the
| price of options.
|
| For example 1 option contract for Amazon (over $3k share
| price) can easily be $4,000. In comparison, you can buy 1
| option for Apple ($400) contract for $200. After the stock
| split, option contracts will be 1/4 the current price.
|
| Lower stock prices make the options market much more
| accessible to people investing less money (for better or
| worse).
| runako wrote:
| Even more relevant for absolute dollar terms: standard
| options contracts are for 100 shares. So a single contract
| of AMZN can require $300k in cash to cover, depending on
| the brokerage.
| 1123581321 wrote:
| I don't think splits are necessary. Fractional shares are an
| abstraction of share ownership though. Many people prefer not
| to rely on their broker for that.
| [deleted]
| crazygringo wrote:
| So interesting that Apple does this around $400... meanwhile
| Amazon's over $3,000 and couldn't care less.
|
| It's very curious to me how and why different companies decide
| whether this is important or not.
| modeless wrote:
| Seems a lot less relevant now with the rise of fractional
| shares.
| Cookingboy wrote:
| But not if you want to trade certain contracts positions.
|
| For example I'd like to sell some covered calls for my AMZN
| as a hedge against a correction later, but since I don't
| own $300k+ of AMZN share, I literally cannot sell a single
| call contract.
| ajzinsbwbs wrote:
| Wow, iPad revenue up 31% YoY after being down ~10% in the last
| few quarters. Similar numbers to a Q1 (holiday season). I guess
| it makes sense that the tablet form factor is popular when so
| many people are indoors.
|
| Also, services revenue grew YoY but it's the first time it didn't
| grow QoQ in a long time, so it seems to have stagnated. Services
| include a lot of recurring revenue so they should be consistently
| growing QoQ.
|
| Wearables growth also slowed, this may be the other side of the
| coin when people are indoors and don't want to buy a watch for
| fitness tracking.
| jackson1442 wrote:
| The pandemic definitely pushed me to get an iPad. Since my
| primary source of income is in tutoring in math/CS, being able
| to draw diagrams with accuracy and share those drawings live
| with my students has been extremely valuable. Before all this,
| most of my income was from in-person clients where I could
| simply grab a piece of paper and pen and draw, now I'm 100%
| online.
| gboss wrote:
| My partner and I bought our God Daughter an iPad for her sixth
| birthday because we were worried about her not being in school.
| We installed a bunch of educational apps for her. She loves it.
| We also get to FaceTime with her and our relatives which is
| fun. I'm sure a lot of iPads were bought for kids stuck at
| home. (Edit typo)
| kwijibob wrote:
| My guess for increased iPad sales: Zoom conferencing during
| COVID
| ekianjo wrote:
| This is probably the largest driver.
| spideymans wrote:
| >Wow, iPad revenue up 31% YoY after being down ~10% in the last
| few quarters. Similar numbers to a Q1 (holiday season). I guess
| it makes sense that the tablet form factor is popular when so
| many people are indoors.
|
| I wonder how much this has to do with the release of iPadOS 13,
| which has made the iPad a significantly more capable "computer"
| than previous versions of the operating system. For the
| majority of users (you don't fall into this category, fellow
| Hacker News reader), the capabilities of iPadOS are quickly
| approaching that of macOS.
| read_if_gay_ wrote:
| iPadOS 13, the new keyboard with trackpad and a cloud VPS
| mean even for typical HNers the capabilities of iPadOS are
| quickly approaching that of macOS. For me, it's totally
| replaced my laptop. I still need a desktop because a fair
| number of very specific things are a PITA on the iPad but in
| general it offers a much nicer UX than my previous ThinkPad.
| ogre_codes wrote:
| iPad had a spring product launch last quarter which makes a big
| difference. The previous generation of iPad Pro was more than
| 18 months prior. iPad sales are pretty weird in terms of
| cyclicality since launch dates are so random between models.
| Steve886 wrote:
| iPhone sales moved up 2% from last year to $26.4 billion in the
| June-quarter. Apple earnings infographic:
| https://news.alphastreet.com/apple-inc-nasdaq-aapl-earnings-...
| racl101 wrote:
| Wonder how much of that revenue is sweet refund transaction fees
| lol.
| jpxw wrote:
| $0. That HN post was based on a falsehood
| matthewdgreen wrote:
| Given the high rates of unemployment in the US and around the
| world (with possibly worse to come) this kind of consumer
| spending on luxury goods is pretty remarkable. Wonder how
| sustainable it is.
| justanotheranon wrote:
| you can buy a new Nokia 2.2 android phone for $100 on Amazon.
| it works perfectly for 99% of what you might ever need to do.
| phones are now at the point where PCs were in 2010--
| commoditized and at a technical peak. so there is no longer a
| compelling reason for the average person to buy the newest most
| expensive model every year. Apple should be dying. maybe it's
| delayed and we'll see Apple's first decline in revenue in 2-3
| years.
| mytailorisrich wrote:
| Here in the UK between working from home and "remote schools"
| (i.e. schools moving online because of the lockdown) spending
| on things like home offices, laptops, etc. went up.
|
| If you're stuck at home you probably and in any case spend more
| time online and/or on your phone, which has to be good for
| whoever owns online app and music stores. (This also explains
| Facebook's good results).
|
| All in all, it's not surprising that results are good for
| Apple. But it is not sustainable growth.
| vosper wrote:
| Are these things actually luxury goods?
|
| A smartphone is probably one of the most essential and
| important devices in many peoples lives these days. Certainly
| one of the most used. There is the option of Android instead of
| Apple, but as someone pointed out one time, iPhones are cheaper
| than flagship Android devices if you account for the support
| lifetime of an iPhone being a lot longer than any Android
| device. And that's not counting the cheaper iPhone Apple
| launched recently.
|
| Likewise, for many people, a computer would probably be
| considered an essential device. Sure there are cheaper Windows
| laptops, but the cost of switching ecosystems is potentially
| quite high, and if you're already in the i-device camp you're
| probably going to stick with a Mac due to its integration with
| all the other things you have (and had before the pandemic)
|
| I would count iPads as largely luxury devices.
| mrkstu wrote:
| iPad Pros for non-business use may be luxury devices, but the
| 'regular' iPad is down to $329 now, solidly low end-
| especially now that iPad OS has mouse support built in and
| Safari supports requesting desktop mode pages.
| throwanem wrote:
| I'd be fascinated to see a breakout of Apple's quarterly
| sales by product. I don't know if such a thing is published,
| and if so I've been unable to find it, but I had also
| wondered what fraction of it the SE 2 would account for. I
| remember seeing headlines that it was selling above
| expectations shortly after launch, but there wasn't any real
| detail that I recall.
| ogre_codes wrote:
| > Are these things actually luxury goods?
|
| I have a lot of trouble characterizing _tools_ as luxury
| goods. I don 't consider my Dewalt tools "Luxury Goods" and
| they cost roughly twice what basic Harbor Freight tools cost.
|
| You pay for longevity and performance. It's no different with
| phones/ tablets/ computers. If you want a phone or tablet
| that lasts 4+ years there is only one brand that offers that
| kind of device life.
|
| Also, with Apple cranking out the base iPhone at $400, and
| the massive second hand market for iPhone, it's hard to argue
| many people associate the brand with luxury the way they do
| Coach or other luxury brands.
|
| If anyone thought Apple was a "luxury" brand, the flop of the
| solid gold Apple Watch "Edition" sub-brand should have
| disabused them of the notion.
| kitotik wrote:
| Looking at the numbers, both iPad and Mac sales exceeded
| estimates, iPhone was inline.
|
| Seems likely a lot of this came from laptop and iPad sales for
| work-from-home, and home education respectively, as opposed to
| frivolous luxury consumer spending.
| crazygringo wrote:
| There's a good argument to be made that Apple devices are not
| luxury goods but save you money in the long run.
|
| They often last for many more years than competitors' products,
| receive upgrades for longer, become obsolete less quickly, and
| Apple will repair them both under warranty and out of warranty.
| (Many competitors simply do not service their products.) _And_
| when you 're finally done with your device, you can often still
| resell it on eBay and get even further value from it, again
| often for much more than with competitors' products of the same
| age.
|
| Apple products on the lower end tend to be fantastic
| investments actually. And given how much we're working from
| home now, your primary devices for remote communication are
| hardly "luxury" and more "essential".
| thecupisblue wrote:
| You reminded me of the last time I spent money on a laptop
| before mac. Well, it wasn't me, it was my parents. For half
| the price of new mac air, I got a Toshiba budget notebook. It
| barely lasted 2 years, which was the amount it's "anything
| happens" warranty expired - which wasn't really anything
| happens. The CD ROM just didnt slide back in totally one day
| and stuck. The shift key got so fucked up I had to disable it
| preboot or I'd be stuck with caps. Fun times. Never again.
| Made me appreciate macs way more when I got one.
| FridgeSeal wrote:
| Oldest phone that gets iOS updates is what, the 6s or the 7?
| The former having come out in 2015, that is an amazing
| support lifetime.
|
| I'm planning on keeping my iPhone X past the end of the year,
| which takes it to a 3 year lifetime, which works out as
| ~$600/year which is amazing value.
| adiabatty wrote:
| Both the 6s(+) and the iPhone SE (the 5s-shaped one that
| people love for the small size) will be able to get iOS 14
| when it comes out later this year.
| [deleted]
| bananaface wrote:
| Everyone is cooped up at home. Not too surprising that they'd
| buy laptops & ipads.
| cobookman wrote:
| My iphone se2 was 400$. I got it at 50% off, so $200.
|
| That's not luxury by any means, and is price competitive even
| with the cheapest of android phones.
|
| Apple's lower price-point offerings might have old hardware,
| but its more than made up for it by just working & offering
| long-term support. Something no android phone can match.
| scarface74 wrote:
| The iPhone SE has the top of the line processor that is still
| faster than any Android phone.
| microtherion wrote:
| I just read today that disposable personal income in the US
| _rose_ by 10% in Q2, thanks to stimulus:
| https://mobile.twitter.com/jasonfurman/status/12888166061650...
|
| If congress really does not extend benefits, there's bound to
| be a sizable negative effect.
| Hippocrates wrote:
| I don't know if I would classify Apple products as strictly
| luxury, certainly not in the same sense as a Casio vs a Rolex,
| a Jansport vs Gucci, or a studio vs a 1 bedroom, Honda vs a
| BMW, staycation watching Disney+ vs trip to Disney.
|
| When I think of cutting back on luxury, I am looking for things
| with a very high incremental cost to incremental value ratio.
| Apple products could be one but it would be farrrr down the
| list speaking for myself and others I know.
| nojito wrote:
| >consumer spending on luxury goods is pretty remarkable
|
| The vast majority of Apple products and services are no where
| near "luxury" prices.
| shadowtree wrote:
| An iPhone is the durable personal computer for most people.
| They don't own a "PC", this is the only way to safely conduct
| e-commerce. Without it, you're done in the modern world (even
| government interactions, like scheduling a DMV visit).
|
| A necessity, not a luxury. Best security, best long term
| support, best re-sale value. If you're poor, an iPhone is the
| smartest choice. You need to AFFORD an Android device.
| VikingCoder wrote:
| I'm surprised to see you say "most people," as Android is
| what, 85% of the market?
| casefields wrote:
| Not in the US which is what OP was referring to. Also, that
| worldwide market share is massive for junky low-end
| androids.
|
| iPhone alone is ~50% of US market share:
| https://www.statista.com/topics/2711/us-smartphone-market/
|
| Android splits the rest.
| objektif wrote:
| The only issue is that iphone revenue was not up but mac and
| ipad was up considerable. So people are actually buying more
| computers and tablets.
| [deleted]
| johannes1234321 wrote:
| iPad is the device Grandma uses during the lockdowns to see
| the grandchildren.
|
| iPad is the device to follow the stream of the school
| lesson.
|
| iPad is what the manager got for his Zoom meetings.
| pkaye wrote:
| Maybe from all the people working and studying from home.
| notsureaboutpg wrote:
| I just don't think the stats bear this out. Apple vs Android
| is like 60/40 market split in the US, that doesn't bear out
| the idea that poor people NEED an iPhone AND know that they
| need it and pay for them accordingly.
|
| It's probably a mix of both. iPhones are probably BOTH a
| status symbol AND a device many people see as a necessity and
| so are willing to splurge a bit more on (same as with cars).
| snowwrestler wrote:
| Maybe a tangent here, but I don't think it's accurate to think
| about Apple stuff as luxury goods.
|
| For example, I don't think the volume they do in phones aligns
| with the typical notion of a luxury brand. The best-selling
| single smartphone model on the market is the iPhone. In analogy
| with the car market: BMW, Mercedes, Lexus do not have a best-
| selling model among them.
|
| The iPhone is more like the Ford F-150, in terms of how it fits
| into the broader marketplace, than it is like a luxury car. The
| F-150 is not inexpensive! But it's not a luxury vehicle either.
|
| Why am I bothering with this argument... because I think it
| leads to confusion about Apple's business, like the comment
| above. Apple does well because they sell products people want,
| on the high end of the range, but well within what a lot of
| people can afford.
| mdoms wrote:
| A Ford F-150 is absolutely a luxury vehicle. And I don't see
| any way you can look at an Apple iPhone as anything other
| than a luxury purchase, regardless of the market share.
| tly_alex wrote:
| "The F-150 carries a base price of $28,495, which is below
| average for a full-size pickup truck." This is just a quick
| search from Google. I think ppl might have different
| opinion of the word "luxury". But generally I would
| personally not categorize things that's widely sold like
| F-150 or iPhone as luxury.
| birdyrooster wrote:
| When you say iPhone, just consider you are speaking about a
| product which starts at $399.
| cm2187 wrote:
| Remarkable? Perplexing. Like facebook revenues up while all
| companies are slashing their marketing budget.
| uptown wrote:
| You just had an entire planet told that they were going to
| stay at home, and that school-age children needed some type
| of device to learn through. That must have driven some
| percentage of new sales.
| dhosek wrote:
| Not to mention things like Bowdoin providing iPad Pros with
| Magic Pencil and Magic keyboard to all their students (plus
| paying for cellular connectivity for those students who
| need it). I imagine this is going to have a knock-on effect
| where this becomes a quasi-standard setup for remote
| education improving Apple's bottom line going forward.
|
| https://www.bowdoin.edu/news/2020/07/bowdoin-to-provide-
| ipad...
| [deleted]
| danhak wrote:
| Regarding Facebook ads: We are in the throes of a general
| election cycle, I'm curious how much of the slack that has
| been picking up. Anecdotally I am seeing tons of political
| ads across the internet.
|
| I am also curious if increased internet usage in general is
| compensating for lower PPC as people are stuck at home.
| dhosek wrote:
| How has Twitter's ad revenue gone? They made the policy to
| eschew political advertising, so they could serve as a
| (somewhat imperfect) control group. On the other hand, they
| also haven't had a high-profile advertiser pull-out like
| Facebook did either.
| dhosek wrote:
| On the ubiquitous political ads, I had to fax something to
| my doctor last month. I didn't want to subscribe to
| something to send a single fax and all the fax services
| that I might have used were unavailable thanks to the
| lockdown. I found a service that offered free faxing with
| an ad on the cover sheet. I didn't think twice about it and
| sent the ad. The confirmation page also had an ad on it.
| For Trump/Pence. Now I'm terrified that the same ad was on
| the fax and I'm going to need to get a new doctor.
| baxtr wrote:
| I never thought of it as a luxury. Actually quite the opposite.
| A luxury is something that I pay a lot of money for but don't
| use it a lot. For me at least. The price per minute used is
| quite low...
| shmatt wrote:
| Unemployed Americans have (temporarily) discovered the world of
| fare living-wage unemployment that expires tomorrow.
|
| If you don't live in NY or CA, those extra $600 a week can go
| very far, and have probably helped stimulate the economy
| greatly
| tomjakubowski wrote:
| If you live in an expensive NY/CA metro, that money can be
| the difference between unemployment benefits covering your
| rent or mortgage payment or not, which is a very big deal.
|
| California's unemployment benefit caps out at $450/week.
| 120bits wrote:
| > If you don't live in NY or CA, those extra $600 a week can
| go very far
|
| True. My girlfriend lost her job March. She is unemployed
| since then. We are not based in NY or CA. She has mentioned
| this to me several times that how much more she has in
| savings now. With all this time and some extra cash, I have
| asked her learn coding. She is working on her app idea.
| pengaru wrote:
| CA has plenty of people living in poverty $600/wk make a
| world of difference for.
| m_ke wrote:
| On top of that student loans have been frozen. That allowed
| me to save an extra $900/month.
| Jommi wrote:
| What planet are we living on?
|
| 600 a week is 2400 a month, which way over any entry level
| salary in Europe.
|
| How inflated are the salaries in US? Or are people used to
| some really abnormal level of living?
| nostrademons wrote:
| Rent for a low-end 1BR in Silicon Valley is about
| $2000/month. Low-end 2BR = ~$2600/month, high-end 1BR =
| ~$4500/month. Houses are ~$10K/month and up.
|
| Entry-level tech compensation is ~$180K/year, mid-career =
| ~$600K/year. If you're not in tech you're screwed here -
| formerly middle-class professions like
| teachers/police/firemen live 4 to a 2BR apartment, or they
| buy houses an hour or more away. Even mid-career finance
| professionals get screwed - salary for CEO of a local (not
| nationwide) bank is in the ~$150-200K range, and barely
| competes with a new grad at Google or Facebook.
| twblalock wrote:
| > Houses are ~$10K/month and up.
|
| That's way high. A million-dollar house on a 30-year
| fixed-rate mortgage, assuming a 20% down payment, is
| ~4800/month including property tax. With a 10% down
| payment it would be about $5800/month.
|
| To get to a $10k/month housing bill you need to buy a
| place that costs close to $2 million. The median sales
| price in Santa Clara county is closer to $1.3 or $1.4
| million. Most people are paying a lot less than
| $10k/month for their house.
| nostrademons wrote:
| The median buyer in Santa Clara County buys a condo -
| that's what's going for $1.3-1.4M.
|
| Low-end SFHs - we're talking a 3/2 built in the 1950s -
| go for about $1.8-$1.9M in Mountain View, $1.6-1.7M in
| Sunnyvale. A SFH like what you'd get in most of the rest
| of the U.S. - 4/2.5 or 5/3 on 1/4 acre lot, built
| somewhere between the 70s and 00s - will run about
| $2.4-2.8M.
| kcb wrote:
| $2400 a month is pretty far below entry level for any white
| color job. Its about what you would earn full time in an
| Amazon warehouse. Or minimum wage in NYC.
| pb7 wrote:
| It's $2,400/mo in addition to the regular unemployment
| amount. The total amount is more than many US workers,
| like teachers and construction workers, make while
| employed[0].
|
| [0] https://fivethirtyeight.com/wp-
| content/uploads/2020/05/atd-U...
| cookiecaper wrote:
| Yes. The reality is that COVID unemployment checks have
| made it so that a lot of people can finally afford this
| type of upgrade. Many people are receiving a larger
| "paycheck" now than they've ever earned in their life.
| reaperducer wrote:
| _600 a week is 2400 a month, which way over any entry level
| salary in Europe._
|
| $2,400/month is the legal minimum wage in some cities.
| ($15/hour)
| nawgz wrote:
| I believe EU salaries are usually discussed after-tax, so
| 2400 / month take-home pay. That is probably the main
| confusion here.
| pb7 wrote:
| Seems like an odd way of going about it. If you and I
| work for the same company in the same exact job role but
| you're married to an unworking spouse with 2 children and
| I am single, I will be taxed higher than you so my take
| home salary would be less despite being paid identical
| amounts. You're destroying information by relaying it
| like this and it's misleading. Your personal tax
| situation is irrelevant to comparing salaries across
| jobs.
| mmcconnell1618 wrote:
| I believe it is $600 per week in addition to the normal
| state unemployment amount. The actual amount received is
| more than $600.
| throwanem wrote:
| Do entry-level salaries in Europe have to cover health
| care? They do here. Even if you're working somewhere with a
| group plan, you're still taking more out of each check for
| medical coverage than for anything else except _maybe_
| taxes.
|
| And if you're on your own for it, it's the same, except you
| pay more and the quality of care is a lot lower because the
| "marketplace" plans are the absolute minimum the insurers
| can get away with and still comply with the law.
| scarface74 wrote:
| That's on top of state unemployment around $400/week. That's
| annualized at $52K a year. The median _household_ income is
| only $65K.
| throwanem wrote:
| Good luck staying on state unemployment for a whole year.
| scarface74 wrote:
| I did say "annualized"....
| twblalock wrote:
| Plus, a lot of employed people got checks from the first
| round of stimulus -- $1200 per individual, $2400 for a
| married couple, and $500 per child. That's just free money
| for people who didn't lose their jobs. Some households have
| earned more during the pandemic than ever before.
| dillonmckay wrote:
| Very few people are paying full price, up front.
|
| It is like leasing a car, except it is a hand computer.
| duxup wrote:
| Do people maybe see phones and related tech / services as sort
| of essential?
| rootusrootus wrote:
| There are other examples as well. For me, it is RVs. Generally
| people only buy them when they're feeling good about the
| future, so you'd expect uncertainty to be devastating right
| now. Nope, dealers are moving them as fast as they can get them
| in stock, and they're not budging on price. Normally you only
| pay about 2/3 MSRP for an RV. Not right now.
|
| Sucks because I want to upgrade to something a little bigger,
| and I don't want to pay an extra 10K just to have it right now.
| So I'll wait until January and see if the dealer is feeling
| more agreeable.
| glofish wrote:
| RV's are not a good sign of recovery in this case.
|
| Usually RVs are bought in addition to other travel, they are
| more of a luxury item.
|
| In the current environment where booking a hotel is
| considered by some risky RVs are bought as a _necessity_ if
| one wants to travel.
| reaperducer wrote:
| _Usually RVs are bought in addition to other travel, they
| are more of a luxury item._
|
| I've seen plenty of newspaper items in the last few months
| about people who usually fly places for summer vacation
| putting that money into a used, or cheap new R.V.
|
| Aside from not being able to fly out of the country, it
| apparently gives them peace of mind knowing they can take
| their quarantine bubble with them wherever they go.
| kbenson wrote:
| Well, that's the safe way to vacation now, take your shelter
| with you. That seems obvious to me once you mention the
| trend.
| ponker wrote:
| My dad just bought one so he could get out while social
| distancing.
| rkochman wrote:
| I don't think RVs are a good indicator. My wife and I just
| bought a 32' Class A motorhome to travel around the country
| in the fall, since I'm forced to work remotely and the kids
| will be doing school remotely. If there were no pandemic, we
| would have never dreamed of buying one.
| rootusrootus wrote:
| Right, I agree that this is probably the fundamental
| reason. Just not something I'd have expected going into
| this crisis.
|
| I'm glad for it, though, we're going to put ours on the
| market in a couple weeks after our last planned camping
| trip for the year, a strong market will be good for resale.
| Hoping it weakens a bit over the winter, though, because
| before next season rolls around I'll want another.
| abtom wrote:
| Either that, or a large number of people are unable to meet
| expenses and forced to break bad. /jk
| chrischen wrote:
| People are saving a lot of money too from not having to
| commute, entertainment, travel, etc. that spending shifted to
| consumer goods. Plus, government handed out a lot of free money
| on too of that.
| kbenson wrote:
| That's likely reduced entertainment expense of eating out and
| of traveling and vacations shifting at least partially to other
| areas. An iPhone costs a lot, but so does a week long vacation
| in another state, and eating out a couple times a week, and
| those are less likely for a lot of people now.
| myth_drannon wrote:
| Correct. No family vacations in France/Italy ($15K easy),
| just spending on gadgets/home renovations.
| dhosek wrote:
| Anecdotally, our app spending is up a lot since the
| quarantine began--my kids (6 yo twins) got iPads for their
| birthday and we've probably spent at least $50 on apps for
| them alone (a mix of educational apps and games). I imagine
| there's a lot of educational app purchases happening in
| general.
|
| As an aside, we use new apps as a reward for various
| exceptional acts. My son looked at my phone not long after we
| started this and told me that I must have done a lot for my
| mom to have put so many icons on my phone.
| gizmo385 wrote:
| Hasn't consumer spending (at least at some level, not
| completely) been propped up by the unemployment assistance and
| CARES act checks? I wonder how much spending on these kinds of
| goods might drop if that assistance goes away.
| throwanem wrote:
| Wouldn't surprise me if a lot of people are buying new phones
| while they're sure they can, to avoid the risk of being stuck
| with an old and potentially failing one when they can't.
|
| Phones are luxury goods only up to a point. Especially once
| you're invested in an app store, it can cost a good deal to
| switch platforms. And it should be news to no one that having
| access to communications grows more, not less, important, the
| closer you get to stony broke.
| reaperducer wrote:
| Perhaps also that Apple is known for making quality phones.
| In times of economic pressure, people buy for the long-term.
| caseyohara wrote:
| We'd have to see the product breakdown, but it's possible this
| could be explained by more people working from home and home
| schooling; people are likely spending more time on devices like
| tablets and laptops. If iPhone sales are up, that would indeed
| be remarkable.
|
| Remarkable either way because Apple stores were closed for most
| of the quarter.
| reaperducer wrote:
| You're right. The work-from-home angle could be part of it.
|
| My company recently announced everyone is staying home for at
| least the next 10 months, and is trying to get hundreds of
| iPhones for everyone who didn't have a company-issued phone
| before.
|
| The company my wife works for is half at work, and half at
| home right now, but everyone is getting new phones, just in
| case.
| quicklime wrote:
| Don't forget that they've just released a new MacBook Air and
| iPhone SE. In hindsight this was the perfect time to be
| releasing cheap devices like this.
| jandrewrogers wrote:
| Interestingly, spending on luxury/positional goods does not
| decline when the economy is poor. This is a well-known effect.
| That is not where people tend to cut back.
|
| If you looked solely at Apple's revenue during 2008/2009 you
| wouldn't even know there was a crash, never mind one that was
| severe by any measure.
| troygoode wrote:
| I don't disagree with your point (it is pretty interesting!)
| but I do think 2008 - one year after the iPhone was
| introduced - is a bit of a special scenario for Apple that
| isn't broadly applicable to other stocks/downturns.
| runawaybottle wrote:
| It could still be framed within the realm of the
| underclass. They don't have enough money to invest, buy a
| home, pay off debt, but they can certainly buy the best
| thing within their buying power - a phone, a tv, heavily
| financed cars, and so on.
|
| I don't think these buying patterns are incongruous to
| reality on the ground. In other news, certainly alcohol and
| drug sales are up too.
| biql wrote:
| I'd guess that people buying luxury goods are also the ones
| least affected by unemployment.
| simonebrunozzi wrote:
| Would you agree that the Tl;dr would simply be "unstoppable"?
| bitxbit wrote:
| Anxiety induced shopping is a real thing. Leisure travel is
| another huge wallet share that's been nonexistent for several
| months now.
| jjcon wrote:
| Anecdotally that is totally the case for me - I've been
| spending money on lots of tech and random fun items. Despite my
| purchases though my spending is overall down because I'm not
| eating out, going on trips/vacations.
| elevenoh wrote:
| Is this hackernews or wallstreetbets? ;)
| Kkoala wrote:
| It's Q2 right? Or do they not use the calendar year for
| accounting?
| xondono wrote:
| They don't use the calendar numbering, but I don't really know
| why
| [deleted]
| jennyyang wrote:
| It's because Apple has to account for returns, and their
| biggest quarter is the December quarter. Most retail
| companies do not end on Dec 31 for this reason.
| DelaneyM wrote:
| Along other reasons, with such a massive percentage of their
| income (and income variability) in Q4, it really helps their
| accountants to close out a tax year in the (relatively)
| predictable and stable Sept after three quarters of
| normalizing cashflows.
|
| Sheltering taxes in a double-Irish requires pretty accurate
| projections.
|
| Also often they just don't have all the data they need to
| close out a year until a few weeks after holidays, especially
| if people are taking a break, so it's just a lot easier on
| the humans involved.
| coldtea wrote:
| Apparently:
|
| For a variety of reasons, some public companies will use a
| non-standard or non-calendar quarterly reporting system. For
| example, Walmart's first quarter is February, March, and
| April; Apple Inc's Q1 is October, November, and December;
| Microsoft Corporation's Q1 is July, August, and September.
|
| In addition, certain governments use different quarter
| systems. The first quarter of the United States federal
| government's fiscal year is October, November, and December,
| Q2 is January, February, and March, Q3 is April, May, and
| June, and Q4 is July, August, and September. State
| governments may also have their own fiscal calendars.
|
| Sometimes a company may have a non-standard fiscal year to
| help with business or tax planning. The Internal Revenue
| Service (IRS) allows companies to choose a "tax year" that is
| still 52-53 weeks long but does not end in December. H&R
| Block (HRB) ends its fiscal year on April 30th, which makes
| sense because that is the end of the busiest part of the
| company's year. Releasing your annual report, which may be
| accompanied by shareholder meetings and additional
| disclosures after the busiest part of your year will help
| managers and shareholders make better decisions about the
| year ahead.
|
| Companies that rely on U.S. government contracts may use
| September as the end of their fiscal year, and the fourth
| quarter because that is when they expect new projects to be
| closed and budget planning from the government to be
| available. Historically, large technology firms had stronger
| quarters early in the year, which is why many of them
| (including Microsoft (MSFT)) have a fiscal year that closes
| at the end of June.
|
| Some companies have very unusual quarterly systems. Adobe
| (ADBE) closes their fiscal year on the Friday closest to
| November 30th. In 2018, November 30th was a Friday, as well
| as the last day of the month but in 2017, ADBE closed their
| fourth quarter and the fiscal year on Friday, December 1st,
| because it was the Friday closest to November 30th.
| kgwgk wrote:
| > Some companies have very unusual quarterly systems
|
| This can make things quite confusing when comparing revenue
| or earnings between periods as years may have 52 or 53
| weeks (a 2% difference) and quarters may have 12 or 13
| weeks (a 8% difference).
| OldHand2018 wrote:
| When you start a company, you choose a "tax year" by filing a
| tax return. From then on out, you file your tax return the
| same month every year.
|
| If it's a small business, you probably find it most
| convenient to have the tax year be the calendar year and
| match up with your personal filing.
|
| Many businesses have some concept of a "selling season" that
| makes it really convenient to not use January through
| December. A retailer, for example, probably prefers not to
| close their books on December 31 every year because of all
| the post-Christmas gift returns. Walmart has a January fiscal
| year (February 1 through Jan 31).
|
| If you sold stuff to schools, you might choose a June fiscal
| year; most universities use a June fiscal year so an entire
| school year stays in a single fiscal year.
|
| I have no idea why Apple chose September, but it was probably
| a rational decision.
| tricolon wrote:
| Possibly related: new iOS and iPhone versions are released
| in mid-to-late September.
| ogre_codes wrote:
| Apple's calendar year was set in stone about 30 years
| before the iPhone was invented.
| dhosek wrote:
| There's a slight tax disadvantage in using a non-calendar
| fiscal year since tax brackets typically adjust upwards
| annually and the non-calendar accounting means that you'll be
| booking some revenue in year X at the less advantageous year
| X-1 tax rates. But other accounting matters can outweigh
| that.
|
| https://www.benzinga.com/news/16/10/8617799/why-do-
| different...
| joshcain wrote:
| They do not - their fiscal year ends 9/30.
| scarface74 wrote:
| For people who like charts.
|
| https://sixcolors.com/post/2020/07/apple-q3-2020-results-eve...
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