Cramer: Apple Is Behind the Destruction of the Laptop
Dell’s disappointing quarter is much bigger than just its weak enterprise, Jim Cramer said Wednesday on CNBC's "Mad Money." It marks the end of an era — what Cramer calls the "great secular decline" of the personal computer, laptop and netbook.
After Tuesday's close, Dell reported earnings and revenue that fell far below analyst expectations, prompting its stock to fall sharply. Some blame the poor results on Dell's management, but Cramer thinks the real problem lies within the shrinking consumer demand for personal computers across the board. Netbooks were down a “staggering” 15 percent, he noted.
"Why have a desktop, a laptop and a phone when Apple's mobile devices make owning a laptop redundant?" Cramer said. "That’s the reason why notebooks and netbooks seem to be going the way of the typewriter."
Apple's popular iPhone and iPad products are “just lethal for the Dell product line,” he said.
Apart from Dell, though, Microsoft and Intel are also suffering from the spike in mobile adoption. Cramer said both firms are banking on sales stabilizing right now, but neither company has adjusted to the mobile world fast enough.
"I think only balance sheet and dividend protection will keep the stock from being hammered but I expect estimate cuts across the board tomorrow," he said.
What's more, Cramer said Facebook could also fall victim to the declining PC business. After all, the advertising world doesn't allow it to charge as much for mobile advertising as it can for ads on personal computers. Generally, advertisers pay less for mobile ads right now.
So what's the bottom line?
"When the smoke clears off this miserable Dell quarter, people will realize that Apple’s behind the destruction of the laptop," Cramer said. "And with that destruction comes a world of hurt for just about everyone, save Apple."
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When this story was published, Cramer's charitable trust owned Apple.
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