Apple Computer 1999

Girish K. Agrawal

outsourced manufacturing . apple shipped Mac Classic for $999 in 1990 Changed gears to form alliances with IBM for OS and also Chips called PowerPC.(Taligent) Another venture Kaleida for language for Set top boxes Sculley also assumed role of CTO in 1990 1991: cut workforce by another 10%. but still led in plug and play and 2 year lead Macs priced $ 10000 (margin 50%) and compatibles prices dropped.successful in shooting revenue to $ 5. (1985-93)          1985: cut workforce by 20% 1986: Mckintosh Plus.10x memory of Mac.switch to Focus on market share.Sculley the marketer shoots…. so Macs looked overpriced (Sculley identified R&D of 9% vs 5% for Compaq and 1% for clones.described situation as ‘glide path to history’ Change of Course in 1990.6 Bil by 1990 Competitive Threat: 1990 compatibles narrowed the gap in ease of use.

91 32.05 19.49 1991 52.85 6.90 6.48 27.10 23.07 14. general.80 11.58 7.09 23.41 8.46 1.34 1992 56.68 .38 1.09 4.53 9.76 11.1993 Cost of sales Research and development Selling.73 1981 50.80 8.29 20.24 1986 46.31 8.37 7. and administrative Operating income (loss) Net income (loss) 65.

PowerPc chip based Power Mac briefly surged but was overpriced by $ 1000 with Intel machines.reduced R&D to 6% Continued Sculley’s focus on ‘hit products’ and competing on price Focus on Market share. International Expansion.Mid Jan results loss of $ 69 Mill for last quarter Announce cut in workforce by 1300 workers .in 1995 Japan tuned from most to least profitable in price war with Fujitsu. DTP 80% Licensed other firms to make Apple clones and priced Mac OS for $ 50. KG to HS segment 60%.cut workforce by 16% 1993. so Apple had to cut price by 25% 1995: Apple and IBM parted ways. none of the partners wanted to shift to new OS after spending $ 600 Mill.poor sales of 80000 units 1996.Spindler the technologist… 1993-95            1993. also chased Chine a small market of 190000 PCs. only 2% were Macs Launched PDAs.

83 15.14 15. general. and administrative Operating income (loss) Net income (loss) 90.37 20.18 3.68 3.31 6.55 1994 74.16 5.30 14.46 1.50 6.38 1.1996 1995 74.95 -14.34 Cost of sales Research and development Selling.06 5.06 -8.16 6.80 8.09 .14 1993 65.

2 Powerbooks had caught fire in 1995 Dropped OS development (cost $ 500 Mill. didn’t succeed Apples worldwide market share dropped from 6 to3%. he proclaimed Apple would return to its DIFFERENTIATION STRATEGY. the Engineer… 1996-97         Faced with rock bottom stock price of Apple 4 months in.) Did 3 reorganizations in the firm 1996: Cut staff by 2800 1997: cut another 4100 Apple still lost $ 1.Amelio.6 Billion from Jan 96 to June 97 and Amelio was forced to quit .

85 18.30 .11 -14.16 -15.1997 1996 90.06 -8.68 6.95 -14. and administrative Operating income (loss) Net income (loss) 80.16 6. general.14 Cost of sales Research and development Selling.76 15.

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