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Post by archibaldtuttle on May 28, 2014 20:13:36 GMT -8
I don't understand this statement. Are you saying that Beats earns $860 to $1,720 million a year? That can't be correct. Yes, that's what I'm saying. According to Asymco, Beats' headphones business was estimated to bring in $1.5 Billion in revenue in calendar 2014 (prior to this sale). Given their prices, I think they have at least as good a margin as Apple. At 40% margin, that's 600 million in earnings in the first year, and at 50% margins it's 750 million. And that's assuming there is no bump in sales that occurs because of this acquisition. If Apple uses their in-store marketing muscle to push Beats this holiday season, I could see them bringing in far more than 1.5 Billion in Beats sales. And then there's 2015.... Adding: that some sources estimate that Beats margins could be as high as 80-90% for some of their headphone lines.
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mark
fire starter
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Post by mark on May 28, 2014 20:21:46 GMT -8
I don't understand this statement. Are you saying that Beats earns $860 to $1,720 million a year? That can't be correct. Yes, that's what I'm saying. According to Asymco, Beats' headphones business was estimated to bring in $1.5 Billion in revenue in calendar 2014 (prior to this sale). Given their prices, I think they have at least as good a margin as Apple. At 40% margin, that's 600 million in earnings in the first year, and at 50% margins it's 750 million. And that's assuming there is no bump in sales that occurs because of this acquisition. If Apple uses their in-store marketing muscle to push Beats this holiday season, I could see them bringing in far more than 1.5 Billion in Beats sales. And then there's 2015.... It still doesn't make sense ... who sells a company that can earn $750M for only 4X earnings? That's crazy stupid pricing. Even crappy businesses can get 6 to 8 times EBITDA in most cases. Also, are you confusing gross margin with earnings?
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Deleted
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Post by Deleted on May 28, 2014 20:48:19 GMT -8
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Deleted
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Post by Deleted on May 28, 2014 20:59:06 GMT -8
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Post by Red Shirted Ensign on May 28, 2014 21:38:35 GMT -8
Dalrymple just "noped" a new 8 gig iPhone 5s or iMac showing up next week.
Apple clearing up expectations and setting the stage...
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Mav
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Post by Mav on May 28, 2014 21:47:11 GMT -8
PREPARE FOR DISAPPOINTMENT Just sayin' Honestly, iPhone 6 and the new iPads, a meaningfully better iOS 8/OS X 10.10 with a couple new services and a new Mac or two would be fine as far as Apple's growth. The rest is just icing.
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JDSoCal
Member
Aspiring oligarch
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Post by JDSoCal on May 28, 2014 22:57:47 GMT -8
I'm encouraged as well that the music industry appears to be embracing this. I read the other day that artists HATE Pandora, including Better Midler, who received $144 on 4M plays. I'm liking this acquisition the more I read about it. Now let's disrupt the personal audio gear with the Beats brand, which will keep its identity (a good move). I'm the consummate capitalist, and I firmly believe that the investors and risk takers should get the lion's share of the profits, but the grand theft by the talentless music industry suits is utterly ridiculous. The artists are idiots for tolerating this rape for so long. At least the old studio execs used to cut the artists checks up front - and then pocket 90% of the sales.
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