Lot's of Dilution at Apple

The latest Apple (NSDQ:AAPL) results really show some massive dilution. Earnings growth should have been even better over the last nine months, if it hadn't been for the roughly 12% growth in shares outstanding. Net income grew 532% while diluted EPS *only* 482%.  Click to enlarge image.

Also, it seems iPod revenue/unit is falling fast, but still revenue is up a lot. Sequentially: 16% unit growth with 9% revenue growth. Year over year looks similar also. But to be fair, even if things might get tougher, Apple is building up a ton of cash in the meantime. Click images to enlarge.

Disclosure: the author is short shares of AAPL.

Comments

[A Stalwart]

I suspect much of the increase in sharecount is based on the increase in share price as more options are now "In The money"

[Anonymous]

Perhaps the lower revenue per unit is because the price of the iPod is dropping. Also take note that as prices fall, fewer accessories are included so sales of accessories (which probably have huge margins) might be growing some. Unit volume growth is probably helped by the lower price point too. Even though fewer accessories are included in the lower priced iPod mini for example, battery life doubled so it's not like the consumer is losing.

[The Author]

Thanks for your comment. Yes, I agree, price per mp3 player is falling- dramatically. Thats what I've been expecting.. and what I continue to expect. And yes I agree with you, the consumer is winning!

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