Apple and the iPad® New Mexico Highlands University Mission Apple is committed to bringing the best personal computing experience to students, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings. History iPad Model Release Date (United States) iPad® April 3, 2010 iPad 2® March 11, 2011 iPad 3® March 16, 2012 iPad 4® November 2, 2012 iPad mini® November 2, 2012 iPad Air® November 1, 2013 iPad mini® (with Retina display) November 12, 2013 Market Analysis United States Macro-environment Gross Domestic Product 15.68 trillion Growth Rate 2.8 Inflation Rate 1.51 Unemployment Rate 7.3% IBIS Industry Report Apple Inc. 13.0% Amazon 35.3% Dell Inc. 6.5% Other 45.2% Product iPad Air Wi-Fi 16 GB $ 499 32 GB 599 64 GB 699 128 GB 799 iPad 2 Wi-Fi 16 GB $ 399 iPad mini (Retina) Wi-Fi 16 GB $ 399 32 GB 499 64 GB 599 128 GB 699 iPad mini Wi-Fi 16 GB $ 299 Wi-Fi + Cellular Wi-Fi + 3G Wi-Fi + Cellular Wi-Fi + Cellular 16 GB $ 629 16 GB $ 529 16 GB $ 529 16 GB $ 429 32 GB 729 32 GB 629 64 GB 829 64 GB 729 128 GB 929 128 GB 829 Product Weight Display Chip Cameras Videos iPad Air 1 pound Retina display 9.7' LED A7 FaceTime HD iSight Camera 1080p HD iPad 2 1.33 pounds 9.7' LED A5 FaceTime Back Camera 720p HD iPad mini (Retina) 0.73 pound Retina display 7.9" LED A7 FaceTime HD iSight Camera 1080p HD iPad mini 0.68 pound 7.9" LED A5 FaceTime HD iSight Camera 1080p HD Marketing Apple relies on brand loyalty Media publicity is a form of advertising Celebrity appeal and product placement in movies and television shows Research & Development Apple’s current R&D is secretive Rumors of an iPad 6 in development 2013 R&D budget was $4,475,000 Apple’s innovation is embodied in its Intellectual Property, including Patents, Trademarks, and Copyrights Protects intellectual property aggressively Stakeholders Governments Schools Families Businesses Environmental & Social Impact 30.9 18.849 1.545 9.27 all values in million metric tons 0.618 0.618 Regulatory Compliance Required to file reports with the Securities and Exchange Commission (SEC) Bound by Sarbanes-Oxley Act of 2002 (SOX) standards Compliant with trade agreements and embargoes Corporate Structure Bruce Sewell General Counsel Peter Oppenheimer Chief Financial Officer Jeff Williams Operations Jonathan Ive Design Philip Schiller Worldwide Marketing Graig Federighi Software Engineering Tim Cook Eddy Cue Software Service Dan Riccio Hardware Engineering Board of Directors Tim Cook Arthur D. Levinson Albert Gore Jr. Robert A. Iger Bill Campbell Andrea Jung Millard Drexler Ronald D. Sugar Financial Statements Net sales Net income Earnings per share: Basic Diluted Cash dividends declared per share Shares used in computing earnings per share: Basic Diluted Total cash, cash equivalents and marketable securities Total assets Long-term debt Long-term obligations (3) Total liabilities Total shareholders' equity 2013 170,910 37,037 2012 156,508 41,733 2011 108,249 25,922 40.03 39.75 11.40 44.64 44.15 2.65 28.05 27.68 - 925,331 931,662 934,818 945,355 924,258 936,645 146,761 121,251 81,570 207,000 16,960 20,208 83,451 123,549 176,064 16,664 57,854 118,210 116,371 10,100 39,756 76,615 (in millions, except number of shares, which are reflected in thousands, and per share data amounts) Financial Performance Current Ratio Acid-test Ratio Gross Profit Margin Operating Profit Margin Return on Assets (ROA) Return on Average Equity (ROE) Debt-Equity Ratio Interest Coverage Ratio Operating Cash Flow/Sales Ratio Earnings per share (EPS) Price / Earnings Ratio (P/E Ratio) Apple (2013) 1.68 1.23 37.62% 28.67% 19.34% 30.64% 67.54% 369.79 31.40% $ 40.03 $ 39.75 14.15 Industry 1.20 0.67 6.39% 13.55% 112.00% $ 10.07 24.33 SWOT Analysis Strengths Weaknesses Brand loyalty Innovative technology Low manufacturing costs Environmental policies Strong financial position Market share Marketing strategy Technology compatibility Opportunities Threats Increase market share Innovation leader Market competition Objectives & Strategies Focus on developing new models Investments into research and development Modifications to market strategy Ethical leadership