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Jaime Signall
FIN 320 – Investments
Investment Selection
Apple Inc
I have chosen Apple Inc as my investment selection. Apple reported a total income of
$11.3 billion on an income of $59.7 billion for the third quarter of the 2020 financial year. The
company presents its revenues as income on the P&L statement. Apple’s sales revenue and net
income has increased significantly in the 2020 financial year compared to the previous fiscal
period of 2019 and 2018. 2019 and 2018 was reported to be 12 % and 10 %, respectively.
The sales revenue generated and presented by Apple Inc. is reported to be driven by
development in both the products and services organizations in different geographic sections
where the company operates. The sales income generated from products has increased business
by 9.8 % in the current financial year to include 7.8 % of total sales revenues. I-Phones
accounted for 44 % of that income, Macs for 12 %, I-Pads for 11 %. Wearable’s, home &
accessories made up about 11 %. Revenue from services accounted for 14.8 %, comprising of
22 % of the total sales revenue reported by Apple (Apple Inc, 3)
Apple has recently mounted an effective corporate approach to decrease its reliance on
lower-edge hardware devices. Currently the lower-edge hardware devices experience slowing
growth. Alongside speeding its services, which has relatively greater margins and predictable,
repeating income stream. Financial year 2019 was the landmark for Apple’s products as the
company introduced a variety of products, which included Apple Card, Apple News+, Apple
TV+, and Apple Arcade.
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The higher profit margin reported in Apple’s financial statements has continued to rise.
The company’s gross margin in fiscal year 2020 is 67.2 %, higher than the last fiscal years 2019
and 2018, presented as 64.1 % and 30.4 %, respectively. For the last three years, Apple has
consistently reported higher profit margins.
Portfolio Diversification
(Mallin and Finkle, 5, 63-74)
