How IBM Helped Apple’s Mac Sales Last Quarter
Apple Has Plenty of Growth Drivers up Its Sleeve to Fuel 2016
IBM is rapidly adopting Macs for its employees
In the prior parts of the series, we have been discussing Apple’s (AAPL) most valuable business, the iPhone, and the factors that will drive its growth in the future. However, Mac is Apple’s second most valuable business and accounted for 13% of its revenues. In the last quarter, which was Apple’s fiscal 4Q15 quarter, Mac sales grew by a year-over-year (or YoY) rate of 3%. Comparatively, the overall PC industry fell by 11% YoY, according to the IDC (International Data Corporation).
Apple gave credit for Mac’s growth to the great customer response that it received for its new MacBook while MacBook Pro sales were also strong. Another important factor that is helping Apple is IBM’s (IBM) rapid adoption of Mac for its employees. IBM has already deployed 30,000 Macs and continues to add 1,900 more every week. Apple claimed that IBM is saving $270 per Mac in support costs and residual value compared to a traditional PC. IBM’s Mac use bodes well for Apple in the enterprise PC market.
Slower adoption of Windows 10 and the wait for Intel’s Skylake processors impacted PC market
Although the above factors helped Mac sales grow in the last quarter, its growth rate of 9% was below what it was in the quarter ending in June as the chart above shows. Market leaders Lenovo and Hewlett-Packard (HPQ) both experienced declining sales, which caused the whole PC industry to suffer. The major factors behind this decline were the slower adoption of Microsoft (MSFT) Windows 10 and the wait for Intel’s (INTC) Skylake processors to arrive in the market.
For diversified exposure to Microsoft, you can invest in the PowerShares QQQ Trust, Series 1 ETF (QQQ). QQQ invests about 8.1% of its holdings in Microsoft.
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