Internet and Global Finance Strategies Research Paper

Download this Research Paper in word format (.doc)

Note: Sample below may appear distorted but all corresponding word document files contain proper formatting

Excerpt from Research Paper:

Internet and Global Finance Strategies

Within the present competitive business environment, firms are continuously looking for various strategies to be ahead of their competitors and achieve competitive market advantages. Many firms have identified that internet technology is a powerful tool to enhance competitive market advantages. The traditional organizations have identified that internet is a powerful tool to deliver value to customer and presently, the internet technology has enabled firms to coordinate and interact their value chain activities to customer with the objective of improving financial performances. These changes generally refer to as NBT (Net-based business transformation). The net-based business transformation is the substitution of traditional business operations from paper, fax and telephone-based communication into electronic business transactions with the objective to enhance tighter coordination with customer and suppliers, increase inventory turnover, enhance customer satisfaction, and improve time-to-market. Despite the potential benefits of internet to the improvement of firms' financial performances, there is still lack of systematic evidence regarding the process through which the internet contributes to the financial performances of Apple Inc.

Objective of this study is to investigate the impact of internet on the revenue and profitability of Apple Inc. within 5-year span between 2008 and 2012.

Theoretical Framework

The model of financial performance and digitalization argues that the major goal that makes firms to engage in net-based business is to improve their financial performances. Typically, firms' objective to engage in the internet based investment is to improve firms business value, which include profitability, market share, ROA (return on assets), ROE (return on equity), and gross margin. According to the model, the driving force that makes firms to engage in the net-based business is to enhance financial performances. The model further reveals that the strategy to evaluate a company financial performances is to use financial ratio tools which include ROA, ROE, gross profit margin, price-earning ratio, current ratio, quick ratio, gearing ratio, and evaluation of firm's balance sheet and comprehensive income statements. (The Irish Times). The study uses the model of financial performances and digitalization to investigate the impact of internet on the revenue and profitability of Apple Inc.

Company Overview

Apple Inc., formerly known as Apple Computer Inc., is a multinational Hi- tech company that designs, develops and sells computer software, personal computer and computer electronics. The company is the second largest IT (information technology) company by revenue. In 2012, Fortune listed Apple as the most admired company in the United States. The best-known company products are iPhone, iPad, and iPod music player. The company software includes iTunes media browser, iOS operating systems, and the Safari web browser. Apple Inc. has been the major Hi-Tech company that takes advantage of internet to boost its profitability within the last 5 years. Apple sells its product globally through online stores, third part cellular carriers, retail stores and direct sale forces. (Apple 2012 Annual Report).

The paper provides the comprehensive impact of internet on Apple Inc. financial performance between 2008 and 2012. The paper uses the 5-year financial records of Apple Inc. To evaluate the impact of internet on the company financial performances.

Impact of Internet on the Apple Inc. Financial Performances

Bughin, et al. argue that internet has changed the way million of organizations transact businesses globally. Essentially, internet has become an essential component for billion of people and businesses around the world.

"The adoption and use of ICTs such as the Internet makes it cheaper and easier for firms to extend their markets, manage their operations, and coordinate value chains across borders. By lowering the costs of transactions and information, technology has reduced market frictions and provided signi-can't impetus to the process of broadening world markets. ICT fosters globalization by declining coordination and transaction costs and creating new and expanded markets with economies of scale." (Kraemer, Gibbs, and Dedrick, 323-324)

Apple Inc. has used the internet to revolutionize the method the company offers its product and services to customer. Typically, iTune is one of the unique Apple's products. iTunes is a free application that allows Apple consumer to download different applications into their smart phone, personal computer, iPod, iPhone, and Apple TV. With internet technologies, it is possible for consumer globally to download the applications, organize music, and browse movies and TV shows. Moreover, Apple Inc. also introduces iCloud, which assists consumer to instantly access the iTune library on their iPhones or personal computers. With the power of internet technologies, Apple has tremendously increased its profitability in the last 10 years. For example, the iTune contents have reached one billion people in February 2013. Apart from individual consumers who download iTune contents for personal enjoyment through the internet, educators in 30 countries create iTune U. courses to deliver educational materials to their students. More than 155 countries could access these education courses via iTune.

Moreover, Apple has used network of internet-online store to reach its customer worldwide. Since Apple operates in multiple countries, the company creates different online stores in all the countries that the company operates. Using internet technology, Apple has been able to reach its customer globally and the company has been able to its online store to sell varieties of its product and services, which include Apple iPhone, Mac, iPod, iPad, iTunes and other products.

Laudon & Marakas argue that Apple has taken the advantages of internet technology to launch the iTunes Music Store that creates a marketplace for the downloadable music. Apple also sells its products and services on the web and manages music digitally. The business solution assists the company to increase sales within the last 5 years. Thus, Apple uses the digital technology to gain competitive advantages within a market environment. Using the internet technologies to deliver superior sale performances, Apple has been able to improve the company financial performances between 2008 and 2012.

Analysis of Apple Sales

The internet technology that Apple integrated in its business operations made the company to record superior financial performances between 2008 and 2012. Since 2008, Apple has recorded a tremendous increase in the net sales. Net sales between 2011 and 2012 increased by 45% ($48.3 billion). Several factors contributed to the increase during the period. First, the company used the internet technology to boost the sales of iPhone using its online stores. For example, the iPhone net sales in 2012 was $80.5 Billion revealing the increase of 71% between 2011 and 2012 while the iPhone unit sales totaled 125 million in 2012 representing 71% increase between 2011 and 2012.

Between 2009 and 2010, Apple net sales increased by $22.3 Billion, which was 52% increased during the period. Typically, the company recorded net sales of $25.2 billion in 2010, which represented the increase of $22.3 Billion or 52% between 2009 and 2010. Between 2008 and 2009, the company net sales increased by 14%. Similarly, the company was able to record an increase in the net sales during the period because the company has used the internet technology to boost the sales of iPhone. The iPhone revenue between 2008 and 2009 was $13 billion revealing an increase of $6.3 billion (93%) between 2008 and 2009.

Moreover, the company takes the advantage of the internet technologies to sale other music related products between 2008 and 2012. Net sales of other music related product and services was $8.5 billion in 2012 revealing the increase of $2.2 Billion, 35% between 2011 and 2012. The increase was primarily due to the increase in the sales of iTune, which generated the total of sales of $7.5 billion in 2012 compared to $5.4 Billion net sales of iTune in 2011. The internet also increased the net sales of the music related products of Apple between 2008 and 2010. The company recorded the increase of $912 million in the music related sales in 2010 revealing an increase of 23% between 2009 and 2010. Moreover, the iTunes generated the total sales of $4.1 billion in 2010.

The Table 1 reveals the net sales and the net income of Apple Inc. between 2008 and 2012. Overview of the company financial records reveal that the company net income was $6.1 billion in 2008 and increased to $41.7 Billion in 2012 revealing the $35.6 billion or 583% increase in the net increase between 2008 and 2012.

Table 1: Apple Inc. Net sales and Net Income between 2008 and 2012 ($ Million)






Net sales






Net income






Earnings per share:













Cash dividends declared per share (a)






Shares used in computing earnings per share:













Total cash, cash equivalents and marketable securities






Total assets






Total long-term obligations (b)






Total liabilities






Total shareholders' equity






The growth of internet technology around the world primarily contributes to…[continue]

Cite This Research Paper:

"Internet And Global Finance Strategies" (2013, April 20) Retrieved October 24, 2016, from

"Internet And Global Finance Strategies" 20 April 2013. Web.24 October. 2016. <>

"Internet And Global Finance Strategies", 20 April 2013, Accessed.24 October. 2016,

Other Documents Pertaining To This Topic

  • Global Business Strategy for a

    Exporting apparel to France would reveal a slightly similar difference. As integrant part of the European Union, France has removed numerous financial barriers in relationship to other EU member states. It has however intensified its barriers relative to product quality and sanitary standards. In terms of the direct relationship between France and the United States, this is generally a positive one, revealing mutual gains and lack of controversy. Efforts are

  • Internet Business Plan What Does

    (Horticulture and the advantages of using the Internet Technology) What are the disadvantages of conducting business, large or small, on the Internet? They may be many. However, the most important disadvantages are: it can actually create a feeling of isolation; the businessman may feel that he has become isolated. This means that he may get the feeling that the World Wide Web is faceless and emotionless, and thus the business

  • Global Fighter Jets Marketing Plan Marketing Vision

    Global Fighter Jets Marketing Plan Marketing Vision Global Fighter Jets is poised to provide customers with high-edge military aircraft specifically to combat fighter jet. Our marketing efforts will be geared towards customer's reassurance that we are the first when searching for military fighter jet such as F-35 fighter in Israel. Our key to success will center on the marketing strategy that we will implement, and our marketing strategy is the marketing mix

  • Internet Marketing Project Social Networks

    The use of the Internet and social networks will continue to accelerate in their use of learning platforms as a result. The design principles of Web 2.0 technologies as shown in Appendix a will also continue to have a significant impact on how social networks used in society in general and in education specifically (Kraemer, 2009). The long-term effect will be the accelerating adoption of Internet technologies to support

  • Internet Technology Marketing and Security

    Internet Technology, Marketing, And Security Reasons why social media marketing has become exceedingly popular among businesses of all sizes Business marketing is one of the most lucrative activities that enable a business to reach out to its consumers in the market. The inherent values within business marketing are creation of awareness and traction of customer preferences and tastes towards the qualities therein in the product. Social media marketing is a recent activity

  • Global Environment Thousands of Companies Compete in

    Global Environment Thousands of companies compete in the global environment. Some of the most prominent global companies are Exxon Mobil, Microsoft, Nestle, Honda, Coca-Cola, Anheuser-Busch InBev, and HSBC. These companies all operate in different industries, and many are based outside of the United States. For companies, operating in the global environment gives them access to a wide range of customers, providing not only growth opportunities but geographic diversification. Global presence can

  • Global E Business Marketing the Advent

    " The final force of collaboration, which Freidman (2006) calls "informing"-which are search engines like Yahoo, Google, MSN, etc., which has facilitated "Internetizer technologies" to work together with limitless information all by itself (Freidman, 2006). Therefore, the initial three flatteners formed the novel stage for cooperation, and the subsequent six have been the novel shapes of cooperation that flattened the world. The last flattener is referred to as "the steroids," and

Read Full Research Paper
Copyright 2016 . All Rights Reserved