In time the Rockies may crumble
Gibraltar may tumble
They're only made of clay
But our love is here to stay
~Ira Gershwin.
These are heady days for Apple and its CEO Steve Jobs. In spite of a world economy that appears to be sliding out of control, and with rumors swirling that Jobs is either retiring, near death, or at least gravely ill; the company he helped found continues to thrive. The iPhone, a mere 15 months after it hit the market, actually outsold RIM, the makers of Blackberry last quarter, selling an unbelievable 7 million units--a fact that Steve Jobs was so pleased about, he took the unusual step of announcing 3rd quarter results himself on Monday.
While Jobs admitted the economy was shaky, he also pointed out that Apple was well positioned to ride out the storm. With an estimated $25B in cash reserves, its not surprising that Jobs is confident in spite of the rash of bad new economic news. While Apple has been raking in the dough, they have also been squirreling it away. Jobs says his company could make some tactical purchases, they could put the money into developing a new generation of products to wow the masses, or they could just hold onto the money. As Macworld reported, the money is not burning a hole in his pocket. Nice to know that Jobs not only runs an innovative company, he's careful with its money (which is more than can be said, ahem, for a lot of CEOs at a lot of firms these days).
But even Jobs can't know what the future holds for the economy, and he admitted as much in the conference call, but he has enough confidence in his company and its products that he believes regardless of the economic gloom and doom that could lie ahead, his company is as well positioned as anyone to hunker down and deal with it. Further, he believes that people may put off buying one of his company's products for the short term, but will likely wait until things improve because, he believes, Apple products are worth it. It may smack of arrogance for him to say that, but the fact is I think he's right. People will wait because, as I've written many times, his company makes really, really good stuff that people want.
There aren't many companies who have a customer base so loyal that they are willing to sit on the sidewalk for more than a week to be one of the first ones to own the latest product. And even when they mess up royally as they did with the iPhone 3G launch (see Consumers Should Be Mad As Hell Over iPhone Launch Debacle (but aren't)), people are ready to forgive and forget, something I pointed out in that blog post that the same people would never do for Microsoft. More recently, Apple pissed off many of its base by releasing the newest generation Mac Books without a Firewire port (see Can't We Just Admit that Apple Knows Best) and then exacerbated the problem by reportedly removing a thread from its web site critical of the move.
Sure Apple can be arrogant, and they can screw up just like any big company, but in spite of this, and perhaps in spite of themselves, the company continues to thrive even against a gloomy economic backdrop. The Rockies may crumble and Wall Street may tumble, but Apple is not going anywhere. Its deep cash reserves ensure that.