Comment by alt227
4 months ago
I think Apple could easily swallow these price hikes in its profit margin if it wanted to, but then its shareholders wouldnt have as pretty numbers to look at in their quarterly reports.
4 months ago
I think Apple could easily swallow these price hikes in its profit margin if it wanted to, but then its shareholders wouldnt have as pretty numbers to look at in their quarterly reports.
This is the explanation for almost all things done by public companies. The shareholders own the company. The numbers in the quarterly reports are important to them.
It seems like they have been doing that for a while now. Most other companies raised prices a while ago. At some point that becomes unsustainable.
All these AI companies need to stop hoarding RAM.
Apple made $120 Billion in profit last year alone.
They could easily keep swallowing this if they wanted to.
But then they would only make $119 billion profit this year, and their reports would show negative growth. Cant have that now.
Apple sells about 400 million units a year.
If they ate an average $100 margin decrease on every one of those sales, that profit number wouldn’t go down from $120bn to $119bn, it would go down to $80bn.
Now you can absolutely argue that $80bn is still an excessively large number, but just so we’re being realistic about what the difference we’re looking at here is, it’s not a tiny percentage of their profits, it’s a third.
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Only a private company can realistically do that.
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The scale of Apple is such that I suspect they also set prices based on what would lead to shortages. If they had significantly lower prices, to avoid annoying customers by not having things in stock, they’d basically have to fund the construction of new factories. They do do that kind of stuff, but it’s not trivial.
How do you know they're not also swallowing a portion of the supplier costs?
https://www.apple.com/newsroom/pdfs/fy2026-q1/FY26_Q1_Consol...
Why would Apple do that?
They could gain a shedload of market share by remaining cheap while pricing in the whole rest of the industry rockets up? Especially after just releasing the Neo, their cheapest laptop ever. They could be taking chunks out of the PC market right now if they werent so greedy.
I'm sure a lot of smart people have weighed all the options and decided that this one was the best.
> They could gain a shedload of market share by...
... having end user replaceable DDR5 RAM and end user replaceable storage. Even if it is a low end underpowered laptop.
Not everyone needs to render 8K videos in 5 minutes.
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Because it could be strategically good to increase their market share and loyalty when everyone else is increasing their prices, for instance? But no, the "fiduciary duty" thing trumps everything, I guess.
Apple is free to make either choice (or anywhere on the spectrum) without violating any duty they have to shareholders.
“We chose to invest in future market share, believing that was in the best interest of the company” is a perfectly valid choice for the company leaders and board to make.
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