Liveblog: Apple’s toughest earnings call in a decade

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How bad is peak iPhone?
Photo: Ste Smith

Apple earnings calls are usually a time for celebration and gloating, but for the first time in over a decade the company is poised to post declining profits.

Tim Cook warned Wall Street that this would likely happen due to declining iPhone sales. Have we really reached “peak iPhone”?

Analysts and reporters will be grilling Cook and Apple CFO Luca Maestri during today’s Q2 2016 earnings call. Investors will be looking for signs that Apple still has room to grow. And Cult of Mac will be right here, liveblogging the entire Apple earnings call — and translating the financial gibberish — when the big event starts at 2 p.m. Pacific.

Get in on the action below:

Apple hoovered up 40 percent of Silicon Valley profits last year

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Apple raked in the cash last quarter.
Breaking news: Apple makes a lot of money.
Photo: Jim Merithew/Cult of Mac

Wall Street seemingly loves to be down on Apple, but if you want some figures to remind you of what a massive profit-generating giant the company is, look no further than the latest numbers collected by SiliconValley.com.

Analyzing the stats coming out of the top 150 Bay Area tech companies for 2015, Apple not only ranked number one in every important metric, but also recorded profits of $53.7 billion in 2015 — which translates to roughly 40 percent of the entire $133 billion Silicon Valley profit pool for the year.

And that’s not all.

Apple hoovers up 92 percent of smartphone profits

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Apple raked in the cash last quarter.
Newsflash -- Apple is making some major bank.
Photo: Jim Merithew/Cult of Mac

Anyone wanting an illustration of why smartphone unit sales are not the single most important metric for judging success should check out wealth management company Canaccord Genuity’s findings about Apple’s iPhone sales versus profits.

According to Canaccord Genuity, despite selling less than 20 percent of all smartphones, Apple rakes in a massive 92 percent of operating income. Samsung, by contrast, ekes out just 15 percent to take second place. Everyone else basically broke even or lost money.

Apple and Samsung now control 106% of smartphone profits

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Samsung is after more of Apple's iPhone business.
Photo: Jim Merithew/Cult of Mac
Photo: Jim Merithew/Cult of Mac

The smartphone wars are two company race and it’s not even close.

Apple and Samsung are dominating the competition so badly that a new report from Canaccord Genuity claims the two tech giants account for 106% of global smartphone profits.

Take a look at this chart:

Apple Earns More Money Than HP, Google, Intel and Cisco Combined

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Everyone knows Apple is incredibly profitable, but did you know that the top-earning tech company brings in more money than Hewlett-Packard, Google, Intel and Cisco combined?

That’s according to the San Jose Mercury News’ newly published Silicon Valley 150 list, which ranks 75 tech companies using data from Bloomberg and U.S. Securities and Exchange Commission filings.

Apple Skyrockets Into Fortune 500 Top 20

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Apple breaks into Fortune 500 top 20
Apple breaks into Fortune 500 top 20.

Apple’s explosive success since the launch of the iPad has helped propel the company higher up the ladder of of the Fortune 500. This year the company broke into the top 20 – nabbing the number 17 spot.

The higher ranking shows consistent growth by Apple – last year the company broke into the top 50 to land at number 35. In 2010 and 2009, the company scored 56 and 71 respectively.

Samsung And Apple: “All Your Mobile Profits Are Belong To Us”

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In a mobile industry that’s simply booming, there’s only two phone vendors reaping the majority of the benefits: Samsung and Apple. In Q1 of 2012, Apple and Samsung combined for 99% of mobile phone vendor profits — the remaining 1% belonged to HTC. Independently, Apple holds the lion’s share of profits with an incredible 73% of operating profits thanks to carrier premiums for the iPhone 4S. Samsung, while leading in mobile phone shipments, only grabbed 26% operating profits — which isn’t really that bad considering every other carrier (other than HTC) managed to face significant losses.

iPhone 4S Helps Apple Rake In 73% Of Mobile Phone Profits

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Apple continues to account for most of the mobile phone industry's profits
Apple continues to account for most of the mobile phone industry's profits.

When analysts and companies compare mobile devices, the big number everyone focuses on is how much market share each platform or product has in relation to its competitors. While this makes for a good overall view of the playing field, it doesn’t always give a clear or accurate picture of which companies are doing well on a single metric as a model for success and ignores others, like whether a platform or manufacturer managed to turn a significant profit.

This is, of course, a very big point when discussing Apple’s iOS succes compared to Android as a whole or to individual manufacturers – and something that Asymco’s latest review of the mobile phone market in which Apple accounts for a small 8.8% of handsets but reaps a whopping 73% of the industry’s profits.

Apple Stores Top List Of America’s Most Profitable Retail Outlets

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If you’ve read the Steve Jobs biography by Walter Isaacson, you may remember that Apple’s board was initially very hesitant to give Jobs a green light about creating Apple’s retail stores. A decade later, the stores have been an amazing success with hundreds of outlets around the world. They have also become the most profitable retail outlets in America.

Research company RetailSails ranked the country’s top retailers using the common retail metric of annual sales per square foot. Apple nabbed the top spot with sales averaging $5,647 per foot – nearly double high-end jeweler Tiffany and Co., which came in a distant second.

Mobile Revenue Doubled Over The Last Five Years… But Only Apple Got The Profits

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It’s pretty much impossible to argue that Apple didn’t revolutionize and reshape the mobile intdustry in the U.S. and around the world. The iPhone changed the concept of what a smartphone could be in 2007. The App Store reimagined smartphone apps and how they could be sold in 2008. And the iPad revolutionized the face of tablet computing in 2010. Those are pretty significant accomplishments technically and culturally.

Now, we also know how Apple reshaped and grew mobile industry financially… and how all of that growth is pocketed in the process.