Running head: APPLE’S OVERVIEW
History and Background Information on Apple.
The firm that will be analyzed is Apple. It is one of the biggest companies in the US, and
it is also very profitable. The company was started in the year 1976 in the state of California. Its
founders were Steve Jobs and Steve Wozniak. For more than three decades after being founded,
the company engaged in the selling of personal computers, which made use of the Macintosh
operating system (Kubilay, 2015). All through the 1990s, the firm was not doing well since the
sales were down by a huge margin. It was after the nineties came to an end that the company
started to re-establish itself as an industry leader. That started with launching the iPod, which
happened in the year 2001. By the year 2007, the company had innovated and made a
smartphone called the iPhone, which would become one of the most revered items in technology.
Since then, Apple has grown to be the largest publicly traded company in the world.
The Industry and Type of Firm
Apple can be termed to be a technology company whereby it engages in the manufacture
of many consumer technologies. As well, it is involved in the making of computer software,
which is made to works in its products such as iPhones and laptops. Additionally, the company
has made a move to online services through its entry to music streaming. So, it is a company that
has managed to be a key player in the technology industry through its policy of constant
innovation to meet the needs of clients.
Banking Structure of Apple
The banking structure of Apple can be termed to be highly polished. For instance, in
other companies, they are used to funding their activities using external capital. Given that, they
have to take loans from banks and other lending institutions. For Apple, the situation is different,
given that the company can collect money from the clients at a very fast rate. As well, the firm
has managed to keep its inventory very low (Türkay, Saraçoğlu, & Arslan, 2016). Given the
ability of the company to have a good cash flow, it implies that in most cases, it does not have to
borrow in the process financing its activities. In terms of debt capitalization or what the company
owes the suppliers, it has been increasing in the last three years by 63% to stand at 225.8%
billion US dollars. That is caused by the slow pace the company has when paying suppliers
(Montgomerie & Roscoe, 2013). As for the financial leverage of the company, it has also been
on the rise at a rate of 126%. Lastly, when assessing the debt to equity ratio, it stands at 112%,
which has been a huge increase.
Current and Past Investments at Apple
In terms of investments, Apple has been strategic in its approach. In the past, it made
investments by making acquisitions of software companies, which would enable the company to
make products that appeal to the clients. Some of the software companies that were acquired
include Propel Software and C3 Technologies. The firm has also acquired Shazam and offer their
clients a way of identifying music. In terms of hardware, the company has made a move to
acquire Beats by Dre, which deals with selling headphones. Currently, the company has invested
in the streaming services with a service named Apple plus which works through subscriptions.
Using Apple Plus, the company has even moved to the creation of original content. That has
resulted in an increase in the number of subscribers on its platforms. All the mentioned
investments have made Apple very successful.
Kubilay, İ. A. (2015). The Founding of Apple and the Reasons behind Its Success. Procedia
- Social and Behavioral Sciences, 195, 2019-2028. doi:10.1016/j.sbspro.2015.06.222
Montgomerie, J., & Roscoe, S. (2013). Owning the consumer—Getting to the core of the
Apple business model. Accounting Forum, 37(4), 290-299.
Türkay, M., Saraçoğlu, Ö., & Arslan, M. C. (2016). Sustainability in Supply Chain
Management: Aggregate Planning from Sustainability Perspective. PLOS ONE,
11(1), 1-18. doi:10.1371/journal.pone.0147502
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