Report on the Apple Annual Meeting

by Fred Fuld III

Last Friday, I attended the Apple (AAPL) Annual Meeting, held in the Steve Jobs Theater by the Apple headquarters in Cupertino, California.

All directors were approved, and other proposals with a recommendation of FOR passed, and recommendations AGAINST did not pass, with a lot of discussion about Proposal 5, True Diversity Board Policy.

After the formal part of the meeting, Tim Cook came out to speak and answer questions. He started out by saying that in 2018, revenues were $262 billion, a $22 billion or 9% increase over the previous year. Growth took place in all categories and regions, with a 1.4 billion installed base now.

iPhone

The iPhone has a 900 million installed base worldwide with revenues of $155 billion. The iPhone XR is the most popular, with the liquid retina display and the A12 biochip. It has the longest battery life of any of the phones. It has a customer satisfaction rating of 99%. Apple is “working on the last one percent.”

Service

The services business had $31 billion in revenues. They expect it to double by 2020.

App Store

The app store is doing well. $120 billion has been paid to developers. Amazing since in 2008, this market didn’t even exist.

Apple Pay

Apple Pay is in 29 markets, with a doubling of usage, and 350 million subscriptions. A new iPad is being released this month. It measures 9.7 inches, with a target audience of the education market. It is priced at $299. There are two new models of the iPad Pro.

The Mac has had an all-time record year.

Wearables

The wearables, which includes the Apple Watch and the AirPods, grew 50% last year.

Investments

$14 billion was spent on R&D last year, and 18 companies were purchased.

Apple is investing across the US, spending $1 billion in Austin, Texas for more work space, along with Culver City, Portland, San Diego, New York, and Pittsburgh.

Dividends

The company is committed to increasing dividends annually, and they are currently double what they were when they first started paying.

Values

They are now using 100% renewable energy around the world.

The company is partnering with Malala Fund, which seeks to secure education for girls around the world. It is also involved with the Everyone Can Code curriculum for students beginning in 3rd grade for kids to easily learn coding. The curriculum is also being accepted in community colleges. The company is also involved with the Everyone Can Create program , which integrates creativity with math and science.

Health

Cook sees the health area as a major opportunity for growth. The company is working with the Veteran’s Administration to get patient records on the iPhone. The Apple Watch is expanding its use in wellness and health.

Apple’s goal is to have all future products use recycled substances.

Tim Cook

Tim Cook’s final comments about hiring, politics, and privacy:

Apple hires based on “skills, capabilities, and contributions”

“We’re capitalists”

“We believe in privacy”

No PACs

“We don’t donate one penny to political campaigns”

“Privacy is the most important issue of the century. We view it as a human right.”

“I’m a free market guy but we’re going for regulation” regarding privacy

“Everyone should have dual factor authentication”

Trivia: The iPhone Name was Originally Owned by Cisco, Not Apple

Here is a bit of financial trivia for you.  Linksys, a division of Cisco Systems Inc. (CSCO), released its iPhone on Monday, December 18, 2006, which was a phone that connects to a home wireless network for making phone calls through the Internet using the Skype service. Skype was originally owned by eBay Inc. (EBAY)at the time and is now owned by Microsoft (MSFT).

It had been anticipated that Apple Computer Corp. (AAPL) would be using the iPhone name back then, but it had been registered by Cisco in 2000. The iPhone trademark is now owned by Apple.

More info about the “first” iPhone release can be found here, an article from bizjournals back in 2006.