Financial Analysis: Apple, Alphabet, and Amazon Comparison Report

This report provides a comparative financial analysis of Apple, Alphabet, and Amazon, examining their financial performance in 2016. The analysis focuses on key financial metrics such as revenue, net income, current assets, and revenue growth, highlighting the financial health and growth trajectories of each company. The report reveals that Amazon experienced the highest revenue growth, and the analysis includes a review of the financial statements of each company. The report uses information from the financial statements of the three companies and the financial reports to assess their performance. The study also highlights the potential of Amazon to become the first trillion-dollar company among the three firms. The report includes key financial information and a comparative analysis to provide a comprehensive understanding of the financial positions of these major corporations.

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Authors’ Note

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About the Companies:
Apple is a publicly traded American transnational firm headquartered in California. The
company was founded by Steve Jobs, Steve Wozniak and Ronald Wayne. Primarily, the
company is involved in the process of designing, developing and selling consumer
electronics, computer software as well as online services.
Alphabet is yet another publicly traded American transnational corporation founded by Larry
Page headquartered in California. The portfolio of Alphabet mainly involves different
industries such as technology, research, life sciences as well as investment capital.
Amazon is a publicly traded organization headquartered in Seattle, Washington. The
company is undertaking operation in electronic commerce as well as cloud computing. In
essence, Amazon can be considered as the largest internet based tech giant in terms of total
sales as well as market capitalization.
Key Financials
Review of the financial reports of the firm Amazon reveals that the company’s stock is up by
around 14% till date and 17% during the previous year. The corporation considerably
outperformed expectations in the initial six months during 2016, however, the company failed
to meet the bottom line approximations particularly during the third quarter of the year 2016.
Review of financial condition during 2016 reflects that Amazon recorded nearly 29% growth
in revenue to more than $29 billion and 161% growth in overall operating earnings to around
$2.9 billion, essentially driven by strong rate of growth across business segments-particularly
Amazon Web Services1.
1 Helbæk, M, S Lindset, & B McLellan, Corporate finance. in , Maidenhead, Berkshire, Open
University Press/McGraw-Hill Education, 2010.

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On the other hand, analysis of financial statements of Apple Inc reveals that cash to some
extent decrease by approximately 1%, while it remains at high level. Again, inventory
remains at consistent level that reflects high percentage of company’s sales. In addition to
this, the total current assets of the business concern Apple registered by the company
augmented by nearly 2% during 2016. Again, long term investment is also high since the
company Apple is also planning to develop a new business entity in California utilizing the
investments during the long term2. Pecuniary reports published by the corporation also
reflects that the fixed assets, intangible assets along with goodwill of the firm are consistent,
while the total current liability of the corporation decreased by nearly 1%. Again, retained
earnings of the corporation also enhanced since cash decreased. Again, there exists no
treasury stocks and it is favourable sign as regards the shares of the company Apple3.
Analysis of the financial statements of Alphabet reveals that the revenue of the firm increased
from $74989 to $90272. This shows a year on year growth of approximately $15.28 billion
during the specific time period of 2016. Again, the operating expenses of the corporation as
reflected in the profit and loss assertion of the firm amounted to $66.56 billion. However, the
line item reflects increase from approximately $55.63 billion as compared to the previous
year’s figure. However, the net income of the firm also increased to $19478 during 2016 in
comparison to the year ago period. In addition to this, inventory of the firm Alphabet Inc also
2 BRIGHAM, E, FUNDAMENTALS OF FINANCIAL MANAGEMENT. in , [S.l.], SOUTH-
WESTERN, 2017.
3 Brealey, R, S Myers, & F Allen, Principles of corporate finance. in , New York, NY,
McGraw-Hill Education, 2017.

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increased from the year 2014 to the year 2015, however, thereafter, the figure for inventory
slightly decreased during the period 2016, thereby reflecting superior sales4.
Comparative analysis of the financial condition of the firm
Critical analysis of pecuniary reports of the three firms during the period 2016 reveals that
the revenue, gross profit as well as the earnings before interest tax depreciation as well as
amortization increased at a faster rate than that of the Apple’s. However, Amazon records the
highest percentage of growth in revenue during the period 2016 among the three different
firms5. Apple’s revenue however slightly declined during 2016 to $215639 as compared to
the year ago period, while Alphabet Inc registered revenue of $90272, up by $15.28% that is
around 20%. However, Amazon registered revenues of $136.0 billion during the period 2016,
that is up 27.1% year on year that is from the level of $107.0 billion recorded during the year
2015. Again, the current assets of the corporation Apple Inc registered to be $89378000 and
the same grew to $106869000. However, the current assets of the firm Alphabet Inc are
recorded to be 105.41 billion as compared to the year ago period. On the other hand, the
current assets of the corporation Apple Inc is observed to be $45781000 as compared to
$35705000. Amazon’s current assets is recorded to be $45.7 billion as compared to the year
ago figure of 35.7 billion. In this case, the current assets of the Alphabet represented superior
figure6. However, Amazon registered net earnings of around $2.4 billion during the financial
year 2016, while the net profit margin as recorded by the firm was 1.7%. Again, on the other
hand, the net income of the firm Apple Inc decreased by around 23% from $53394000 to
4 PRASANNA CHANDRA., Financial Management. in , Tata McGraw Hill Education Pvt.
Ltd., 2011.
5 Helbæk, M, S Lindset, & B McLellan, Corporate finance. in , Maidenhead, Berkshire, Open University
Press/McGraw-Hill Education, 2010
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$45687000 in 2016. Again, the net income of Alphabet Inc was registered to be 19.4 billion
in 2016 as compared to 15.8 billion in 2015. Therefore, it can be hereby mentioned that
Amazon represented a strong trajectory of growth both in terms of revenue as well as net
earnings reflecting comparatively better financial health of the firm during the period 2016.
In addition to this, the trend indicates that the business concern Amazon has the potential to
become the first trillion company among the three firms.

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References
Brealey, R, S Myers, & F Allen, Principles of corporate finance. in , New York, NY,
McGraw-Hill Education, 2017.
Helbæk, M, S Lindset, & B McLellan, Corporate finance. in , Maidenhead, Berkshire, Open
University Press/McGraw-Hill Education, 2010.
BRIGHAM, E, FUNDAMENTALS OF FINANCIAL MANAGEMENT. in , [S.l.], SOUTH-
WESTERN, 2017.
PRASANNA CHANDRA., Financial Management. in , Tata McGraw Hill Education Pvt.
Ltd., 2011.