Live notes from Apple Inc.’s Fiscal Fourth Quarter Conference Call appear in reverse chronological order:
• End of conference call.
• Jobs: We have an advantage on iPad price because we make the A4 processor, we make the battery chemistry, we make a lot and we’ve learned something. We’ve eliminated the middle man in many cases. iPad is a product we’ve been training for for the last decade.
• Cook: Virtually every carrier is pressuring us for supply. They want more supply and we are working to meet it.
• Oppy: We are always working aggressively to lower our costs. We are happy with our gross margins, better than we expected.
• Cook: We maintain our focus on the consumer, but its the consumers in the enterprise that are pulling our products into business. We think this will continue to pay great dividends for Apple.
• Cook: About 2/3rds of Fortune 500 are deploying or trailing iPad. K-12 ed is also picking up interest on iPad. Early data potions look great. We are adding sales people to call on education specifically for iPad.
• Jobs: Our $50+ billion cash. We believe that one or more strategic opportunities may come along. We’d like to keep our ability to move if opportunities present themselves.
• Jobs: Hardware makers think the software will take care of itself, but it won’t. They fail to think in an integrated manner. Apple thinks about everything, the hardware, the software, everything.
• The reason we don’t make a 7-inch iPad is because we do not believe that you can make a great experience with that size screen. When we make decisions, it’s not about cost, it’s about the value of the product when you factor in the software.
• Jobs: Our goal is to make really breakthrough products in every market where we compete and to drive the cost down while offering better functionality. Relentless improvement at the same or better prices.
• Jobs: I imagine well be competing with Android for quite some time. We provide users with products that just work. Android is already quite fragmented for both users and developers.
• Jobs: Our goal is to make the best devices in the world, not to be the biggest. As you know, Nokia is the biggest and we admire then for what they do, but we don’t want to be like them.
• What drove the sequential downtick in margins: Apple expected a higher mix of iPhone 4 (lower gross margin that previous iPhone model), free bumper program, iPads, and new iPods with outstanding features.
• Jobs: We have already sold over 250,000 Apple TV units. We are thrilled with that. We think the $99 price is enticing and when AirPlay is ready, it will be another grate driver of sales.
• Jobs on Apple TV: We have gone to a complete streaming model on Apple TV. All of the content is rented or streamed from your computer and soon to be streamed from iOS devices.
• CFO Oppenheimer: Margin decline due to higher mix of iPad and new iPod sales.
• Jobs: I think right now, iPhone and Android are winning the battle for smartphone developers and users.
• Will Apple be able to maintain market share in tablets? Jobs: I have a hard time envisioning what the competitors can do. They are having a hard time with pricing, even with too small screens and they do not have over 35,000 iPad apps like we have in App Store. “We’re out to win this one.”
• Cook: iPhone demand went to an entirely different level, beyond what Apple anticipated.
• Jobs questioned on Flash: “Flash memory? We love flash memory.” (laughter)
• Jobs: We’re already shipping more iPads than Macs
• Jobs: I see iPad as a general purpose device and I see it as really big
• Jobs: The more time that passes, the more I’m convinced that with iPad, we’ve got a tiger by the tail here.
• Jobs: iPad is clearly going to affect notebook computers. Not a question of if, but of when. Appel is already seeing tremendous interest fro eductaion and, much to my surprise, in business. iPad is being grabbed out of our hands by businesspeople.
• Wow! We’ll clean up Jobs’ paraphrasing with actual quotes later.
• Jobs: 7-inch tablet makers will learn a tough lesson and try to make 10-inch tablets next year, abandoning users and developers in the process.
• Jobs: The current crop of 7-inch tablets are DOA.
• Jobs: Even Google says not to use the Android Froyo in tablets, yet some 7-inch tablet makers are in it anyway. And they will have virtually no apps.
• Jobs: The 7-inch tablet is too big to compete with an iPhone and too small to compete with an iPad.
• Jobs: We have done the testing. That is why the 10-inch screen size is the MINiMUM size for a good tablet experience
• Jobs: 7-inch tablets are only 45% as large as iPad’s screen (screens are measured diagonally) This size isn’t sufficient to make quality tablet apps.
• Jobs: We think integrated (not matter how many times Google mischaracterizes it as “closed” will triumph over fragmented (which Google touts as “open.”)
• Jobs: We think the “open” vs. “closed” argument obscures what’s really important: What’s best for the user?
• Jobs: Open systems do not always win: Take Microsoft’s “PlaysForSure.” It failed.
• Jobs: Apple is not fragmented, has 3x as many apps and one App Store is easy for developers and users
• Jobs: Android Developers are presented with a daunting challenge of hundreds of OS software versions and devices. At least four Android app stores will be a mess for both users and developers.
• Jobs: Android is very fragmented; proprietary UIs, etc. User is left to figure it all out.
• Jobs: Google characterization of Android as “open” is disingenuous.
• Jobs: 275,000 iOS devices activated per day on average
• Jobs: With 300,000 apps now in App Store, RIM has a high mountain to climb
• Jobs: We have now passed RIM and I do not see them catching us anytime soon
• Jobs: 91% YOY unit growth in iPhone sales
• Apple CEO Steve Jobs attends earnings call to mark Apple’s first $20 billion quarter
• Apple expects 25.5% tax rate for 2011.
• In fiscal 2010, Apple generated 5 times the revenue and 10 times the earnings vs. 2005
• 7.5 million iPads sold so far
• 40 million iPhones sold
• 13.6 million Macs sold in fiscal 2010
• Apple to open 40-50 stores in fiscal 2011 with roughly half being outside U.S.
• 74.5 million visitors during quarter and increase of 62% YOY.
• Apple now has 317 stores worldwide, 84 outside U.S.A.
• 24 retail stores opened during quarter
• Apple Retail: 3.57 billion vs. 2.04b, 874,000 Macs sold a record (+30%)
• iAd: Apple very happy with results so far.
• Over 200,000 registered iOS developers.
• iOS device sales of over 25 million during the quarter.
• iPad ASP about $645. 3-4 weeks of channel inventory, below target of 4-6 weeks.
• iPhone demand is strong. Apple believes they could have sold even more iPhones if they could have made them
• Record 3.89 million Macs during the quarter, a 27 percent unit increase over the year-ago quarter.
• 14.1 million iPhones in the quarter, representing 91 percent unit growth over the year-ago quarter.
• Apple sold 9.05 million iPods during the quarter, representing an 11 percent unit decline from the year-ago quarter.
• Latest NPD monthly data: iPod remains market share leader with over 70% of market.
• 4.19 million iPads.
• Revenue of $20.34 billion (vs. $12.21 billion)
• Net quarterly profit of $4.31 billion (vs. $2.53 billion)
• $4.64 per diluted share (vs. $2.77)
• Gross margin was 36.9 percent compared to 41.8 percent in the year-ago quarter. • International sales accounted for 57 percent of the quarter’s revenue.
GO STEVE… tell ’em what it’s all about!
GO STEVE… tell ’em what it’s all about!
5 times the revenue and 10 times the earnings of a year ago! Whew! This is staggering growth.
5 times the revenue and 10 times the earnings of a year ago! Whew! This is staggering growth.
Samsung and other 7in. screens –> steve says you need to provide sandpaper to sand down users fingers to match functionality in that space. haha –> tweeners
don’t use froyo for tablets says google… wait until next year… LOL!
Samsung and other 7in. screens –> steve says you need to provide sandpaper to sand down users fingers to match functionality in that space. haha –> tweeners
don’t use froyo for tablets says google… wait until next year… LOL!
… Happy 401k
” width=”19″ height=”19″ alt=”grin” style=”border:0;” />
BUY AAPL stocks!!! $$$$ No Brainer!
… Make $$$$ as Apple Inc. is not even close to peaking. Tsunami Global expansion is happening!
Go APP
” width=”19″ height=”19″ alt=”grin” style=”border:0;” />
… Happy 401k
” width=”19″ height=”19″ alt=”grin” style=”border:0;” />
BUY AAPL stocks!!! $$$$ No Brainer!
… Make $$$$ as Apple Inc. is not even close to peaking. Tsunami Global expansion is happening!
Go APP
” width=”19″ height=”19″ alt=”grin” style=”border:0;” />
@Not Bill
That staggering growth is in 5 years, not over one year. 2010 vs 2005
@Not Bill
That staggering growth is in 5 years, not over one year. 2010 vs 2005
Ooops! That is 5 and 10 times over 2005. A five year time frame. Wierd to be quoting five year gains.
Ooops! That is 5 and 10 times over 2005. A five year time frame. Wierd to be quoting five year gains.
Holy CRAP! Steve just threw down the glove! Told RIM that they are never going to catch up. Told Android phone manufacturers that Google’s “open” strategy is the wrong one. Told all the supposed tablet competitors that they are all DOA! Not your normal discussion in a quarterly earnings conference call.
Wow!
Holy CRAP! Steve just threw down the glove! Told RIM that they are never going to catch up. Told Android phone manufacturers that Google’s “open” strategy is the wrong one. Told all the supposed tablet competitors that they are all DOA! Not your normal discussion in a quarterly earnings conference call.
Wow!
So much for that 7″ iPad with the way Steve’s talking.
So much for that 7″ iPad with the way Steve’s talking.
Don’t look at after hours trading, it’s not pretty!
Are the shorts coming home to roost?
301.20 -16.80 (-5.28)
Don’t look at after hours trading, it’s not pretty!
Are the shorts coming home to roost?
301.20 -16.80 (-5.28)
And (Wallstreet) people are disappointed?? Amazing…
And (Wallstreet) people are disappointed?? Amazing…
“iPad ASP about $645. 304 weeks of channel inventory, below target of 4-6 weeks.”
Can someone please explain the above? What is ASP? Channel inventory is 304 weeks? That’s almost six years! Below what target?
“iPad ASP about $645. 304 weeks of channel inventory, below target of 4-6 weeks.”
Can someone please explain the above? What is ASP? Channel inventory is 304 weeks? That’s almost six years! Below what target?
LOL Jobs is taking a sledgehammer to his competitors. His confidence is through the roof. He knows that these results will be nothing compared to what Apple does a year from now. He’s fscking giddy with joy.
LOL Jobs is taking a sledgehammer to his competitors. His confidence is through the roof. He knows that these results will be nothing compared to what Apple does a year from now. He’s fscking giddy with joy.
@Chesspiece,
Three to four weeks of channel inventory, not 304 weeks.
ASP = Average Sales Price
@Chesspiece,
Three to four weeks of channel inventory, not 304 weeks.
ASP = Average Sales Price
@chesspiece
ASP – Average Sales Price
304 weeks – That’s a typo. Should say 3 to 4 weeks.
@chesspiece
ASP – Average Sales Price
304 weeks – That’s a typo. Should say 3 to 4 weeks.
Average Sales Price (ASP)
That must be 3-4 weeks of channel inventory.
Average Sales Price (ASP)
That must be 3-4 weeks of channel inventory.
@Chesspiece
ASP = Average Selling Price
3-4 weeks vs. 4-6 weeks of channel inventory
Means the inventory Apple has on hand will only last 3-4 weeks vs. 4-6 weeks they had originally anticipated. (i.e. the iPad is selling faster than anticipated or they have lower inventory than they once thought they would)
@Chesspiece
ASP = Average Selling Price
3-4 weeks vs. 4-6 weeks of channel inventory
Means the inventory Apple has on hand will only last 3-4 weeks vs. 4-6 weeks they had originally anticipated. (i.e. the iPad is selling faster than anticipated or they have lower inventory than they once thought they would)
@Chesspiece
I could tell you. But then I’d have to kill you.
@Chesspiece
I could tell you. But then I’d have to kill you.
ASP Average Selling Price
304 probably should have been 3-4 weeks
ASP Average Selling Price
304 probably should have been 3-4 weeks
He is mentioning Android a lot, and seems to be very careful NOT to talk about patent infringement. Could it be that they’re bracing themselves (and their investors) for the possibility of not winning anything meaningful in those lawsuits?
He is mentioning Android a lot, and seems to be very careful NOT to talk about patent infringement. Could it be that they’re bracing themselves (and their investors) for the possibility of not winning anything meaningful in those lawsuits?
And if anyone here isn’t sure: there will be NO small iPad (large iPod touch). After repeating his thoughts about the 7″ device (not good for user interface), I can’t imagine him going back on it. Something significant would have to happen for them to change their minds.
And if anyone here isn’t sure: there will be NO small iPad (large iPod touch). After repeating his thoughts about the 7″ device (not good for user interface), I can’t imagine him going back on it. Something significant would have to happen for them to change their minds.
1992 called…they want their cliché back.
1992 called…they want their cliché back.
Jobs: We have now passed RIM and I do not see them catching us anytime soon.
Hey, you never know but, RIM could start a 3 or maybe a 4 for the price of 1 sale this holiday season and possibly catch Apple.
Jobs: We have now passed RIM and I do not see them catching us anytime soon.
Hey, you never know but, RIM could start a 3 or maybe a 4 for the price of 1 sale this holiday season and possibly catch Apple.
“Jobs: The more time that passes, the more I’m convinced that with iPad, we’ve got a tiger by the tail here”
Sorry, was that a Steve Jobs quote or a ‘my Grandmother’ quote?
” width=”19″ height=”19″ alt=”raspberry” style=”border:0;” />
“Jobs: The more time that passes, the more I’m convinced that with iPad, we’ve got a tiger by the tail here”
Sorry, was that a Steve Jobs quote or a ‘my Grandmother’ quote?
” width=”19″ height=”19″ alt=”raspberry” style=”border:0;” />
Tony Saconnaghi keeps pushing the dividend question (as well as ‘What are you doing with the pile of cash?’ one).
We should expect another article of him suggesting how Apple should better offer dividend, or buy back shares, or do something to start spending nearly $50B (as in billion) of that war chest.
Tony Saconnaghi keeps pushing the dividend question (as well as ‘What are you doing with the pile of cash?’ one).
We should expect another article of him suggesting how Apple should better offer dividend, or buy back shares, or do something to start spending nearly $50B (as in billion) of that war chest.
Wonder how well the new nano is doing
Wonder how well the new nano is doing
Yestersday I replaced (recycled and received a discount) my 1st Gen iPod Nano with a new 6th Gen Nano.
Yestersday I replaced (recycled and received a discount) my 1st Gen iPod Nano with a new 6th Gen Nano.
The investors are saying the iPad was a disappointment? over 4 million a disappointment – wow I would like to have a product that didn’t have a market that they said will not sell and then sell 45,000 a day.. Wow they re idiots…
The investors are saying the iPad was a disappointment? over 4 million a disappointment – wow I would like to have a product that didn’t have a market that they said will not sell and then sell 45,000 a day.. Wow they re idiots…
So it would seem that the 7″ iPad was created during the research and development phase, and usability testing led Apple to the conclusion that 7″ was not a good size for a tablet computer.
Suck though it may, that 7″ prototype would make a hell of a collectors item.
So it would seem that the 7″ iPad was created during the research and development phase, and usability testing led Apple to the conclusion that 7″ was not a good size for a tablet computer.
Suck though it may, that 7″ prototype would make a hell of a collectors item.
@Lurker_P
I would by a nano too if it had a notes app and an applescript editor
(heck it almost replace my ipod touch if they put those things on there)
@Lurker_P
I would by a nano too if it had a notes app and an applescript editor
(heck it almost replace my ipod touch if they put those things on there)
“iPad is the product we have been training for for the last decade.”
What a awesome statement. These guys are an amazing force. It is the stuff of movies, not reality. It is like they are ‘mowing them down”, “moving mountains”, “shoot with both hands at waist height.” “Yippie-Ki-yay Motherf___er”
“iPad is the product we have been training for for the last decade.”
What a awesome statement. These guys are an amazing force. It is the stuff of movies, not reality. It is like they are ‘mowing them down”, “moving mountains”, “shoot with both hands at waist height.” “Yippie-Ki-yay Motherf___er”
25% tax rate is obscene! Punish the productive sectors of the world to feed the unproductive sectors.
25% tax rate is obscene! Punish the productive sectors of the world to feed the unproductive sectors.
Perhaps as he is closer to retirement, Jobs is simply disappointed by the competition. Do people still not realized that, whenever they try some different formula to try to *differentiate* from Apple ware, Apple has already tried and toss those various designs as failures.
Given the choice to work as partners and focus on greater profit together, Jobs is probably also bitterly disappointed by Google’s following of Microsoft’s path. It’s the same Sell-Everything-and-Take-No-Prisoners Amazon model that has proliferated our hi-tech (Cisco, HP, IBM, Oracle) and big box stores – the reason everybody is working twice as hard but making half as much.
Perhaps as he is closer to retirement, Jobs is simply disappointed by the competition. Do people still not realized that, whenever they try some different formula to try to *differentiate* from Apple ware, Apple has already tried and toss those various designs as failures.
Given the choice to work as partners and focus on greater profit together, Jobs is probably also bitterly disappointed by Google’s following of Microsoft’s path. It’s the same Sell-Everything-and-Take-No-Prisoners Amazon model that has proliferated our hi-tech (Cisco, HP, IBM, Oracle) and big box stores – the reason everybody is working twice as hard but making half as much.
While I am on a roll…
Meanwhile, up in Redmond, M$ can’t figure how to shoot its way out of a paper bag!
While I am on a roll…
Meanwhile, up in Redmond, M$ can’t figure how to shoot its way out of a paper bag!
iPad sales = first iPhone sales, and we all can see how that went.
Next Q = 25bill, 5mill Macs, 8mill iPads, 12mill iPods, 15mill iPhones. 25th Jan AAPL = 376.54. (approx.)
iPad sales = first iPhone sales, and we all can see how that went.
Next Q = 25bill, 5mill Macs, 8mill iPads, 12mill iPods, 15mill iPhones. 25th Jan AAPL = 376.54. (approx.)
A nice casually mentioned bit of detail. Apple TV 2.0 has been at stores and shipping for only about half a month, and they have already sold 250,000. I think they can maintain that rate through the holiday shopping quarter and sell at least one-and-a-half million. I think the new Apple TV, along with the new (A4, Retina Display, dual cameras) iPod touch, are going to be two “stealth” hit products for the current quarter.
Now, I can’t wait for the new news on Wednesday…
A nice casually mentioned bit of detail. Apple TV 2.0 has been at stores and shipping for only about half a month, and they have already sold 250,000. I think they can maintain that rate through the holiday shopping quarter and sell at least one-and-a-half million. I think the new Apple TV, along with the new (A4, Retina Display, dual cameras) iPod touch, are going to be two “stealth” hit products for the current quarter.
Now, I can’t wait for the new news on Wednesday…
@Predrag
Jobs is not allowed to comment on active litigation in which he is a participant.
@Predrag
Jobs is not allowed to comment on active litigation in which he is a participant.
Steve talked too much.
Steve talked too much.
Release the KRAKEN Steve!
Release the KRAKEN Steve!
@ Not Bill,
I don’t see Apple so much as the guns blazing, “shooting with both hands at the hips” type of situation. Rather, I see Apple as more of a surgical sniper, up on a hillside (where margins are high), lining a competitor up in their sights, exhaling, and gently squeezing the trigger… Pow! Another of their competitors’ tiny-margin no-innovation products down on the valley floor bites the dust.
Then they reset, line up, and pull the trigger again to drop yet another competitor’s product before it reaches its first birthday.
The process keeps repeating itself.
Meanwhile, neither the enemy or the press covering the war have a clue how Apple is doing it.
Apple… The lone sniper on the hill defending itself against an army of attackers – and winning.
@ Not Bill,
I don’t see Apple so much as the guns blazing, “shooting with both hands at the hips” type of situation. Rather, I see Apple as more of a surgical sniper, up on a hillside (where margins are high), lining a competitor up in their sights, exhaling, and gently squeezing the trigger… Pow! Another of their competitors’ tiny-margin no-innovation products down on the valley floor bites the dust.
Then they reset, line up, and pull the trigger again to drop yet another competitor’s product before it reaches its first birthday.
The process keeps repeating itself.
Meanwhile, neither the enemy or the press covering the war have a clue how Apple is doing it.
Apple… The lone sniper on the hill defending itself against an army of attackers – and winning.
After hours trading
Apple at 300.00 after being down at 299.
After hours trading
Apple at 300.00 after being down at 299.
Listened, Steve is awesome, on a very articulate brilliant roll! Very enthusiastic, precise, well thought out, clear as a bell. What a Titan! All cylinders firing like a rocket!
Listened, Steve is awesome, on a very articulate brilliant roll! Very enthusiastic, precise, well thought out, clear as a bell. What a Titan! All cylinders firing like a rocket!
@ecrabb
Maybe. To use your analogy, they are running around in circles, trying to ge organized, and the pops keep comming from the hills controlled by Apple. Their losses are mounting.
Myself. I like Steve Jobs is the Diehard of the technology world. He is put up for adoption. He drops out of college. He is kicked out of Apple. He has cancer. He has a liver transplant. He beats them all accomplishes the goal: to change the world.
In the end he triumphs.
@ecrabb
Maybe. To use your analogy, they are running around in circles, trying to ge organized, and the pops keep comming from the hills controlled by Apple. Their losses are mounting.
Myself. I like Steve Jobs is the Diehard of the technology world. He is put up for adoption. He drops out of college. He is kicked out of Apple. He has cancer. He has a liver transplant. He beats them all accomplishes the goal: to change the world.
In the end he triumphs.
@ kingmel and silverhawk
Wallstreet always buys on rumor and sells on announcement.
They have insider info and buy …and then sell and dump it on the regular guy after the announcement.
Very predictable…
@ kingmel and silverhawk
Wallstreet always buys on rumor and sells on announcement.
They have insider info and buy …and then sell and dump it on the regular guy after the announcement.
Very predictable…
@ Not Bill
It is nice to see someone living with issues and continuing his drive. He speaks well and, in most cases, is respectful yet challenging. I would love to have lunch with him and pick his brain.
@ Not Bill
It is nice to see someone living with issues and continuing his drive. He speaks well and, in most cases, is respectful yet challenging. I would love to have lunch with him and pick his brain.
@ clinicaltechmaster
Yup – we’ll have to see if the last pump up of the stock was all about generating profit for the brokers.
If the stock starts going back down to 260 again then you’ll know it was all manipulated.
We’ll see what tomorrow brings.
@ clinicaltechmaster
Yup – we’ll have to see if the last pump up of the stock was all about generating profit for the brokers.
If the stock starts going back down to 260 again then you’ll know it was all manipulated.
We’ll see what tomorrow brings.
Hedge funds suck…Hedge funds suck…Hedge funds suck…Hedge funds suck…Hedge funds suck…Hedge funds suck. Would love to meet one of those Hedge fund manager bastards.
Hedge funds suck…Hedge funds suck…Hedge funds suck…Hedge funds suck…Hedge funds suck…Hedge funds suck. Would love to meet one of those Hedge fund manager bastards.
Why does the Conference call begin by ending? You have it all messed up!
Why does the Conference call begin by ending? You have it all messed up!
@radioflyer
I would like to make lunch OF him and pick his brains.
@radioflyer
I would like to make lunch OF him and pick his brains.