Apple PC profits are seven times higher than HP’s

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At the weekend, it can be interesting to get a hold of marketing research and company financials – it looks like Matt Richman has been busy doing some profit calculations. Earlier this month Peter Misek of Jefferies and Company indicated that Mac gross margins were hovering around 28%.

When we look at Apple’s revenue of $4,976 billion from the sale of 3.76 million Macintosh computers last quarter we can begin to work out profits. Dividing the revenue by 3.76 million macintosh computers and the average selling price is around $1,323.

That figure of $1,323.30 can be divided by 0.28 to get a figure of $370.55. This is the profit that Apple make for every Mac sold.

27 inch imac Apple PC profits are seven times higher than HPs

The 27 inch iMac - one of Apple's finest moments

HP’s Personal Systems Group brought in $9,415 billion in revenue and made a profit of $533 million last quarter. Richman adds “Their operating margin, which doesn’t factor in overhead costs, was 5.66%. If we assume they spent 1% of their $9.415 billion in revenue — $94.15 million — on operations, then their profit margin was 6.66%. But let’s give them the benefit of the doubt and make it 8%.

The average selling price of a Mac increased 5.71% over the last two quarters. If we apply that growth rate to NPD’s data that says the ASP of a PC was $615 in November, then the ASP of a PC today is $650.12. Multiply that number by an 8% profit margin and HP makes $52.00 for every PC they sell.”

Kitguru says; The final outcome? Apple are making more money from selling one Macintosh computer than HP are making from selling seven PC’s. It would appear that the Apple business model is easily way ahead of the leading PC manufacturers.

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