Apple analysts and investors look for signs of ‘Intel effect’ in tomorrow’s earnings report

“When Apple reports its second quarter earnings tomorrow, investors and analysts will watch closely for evidence of how the company’s switch to Intel chips is panning out,” Amanda Cantrell reports for CNNMoney. “The March quarter is seasonally slower for Apple (up $1.35 to $66.16, Research), and analysts and investors are universally predicting a big slowdown in both iPod and Mac sales from December’s blowout numbers for that reason. But they are nonetheless forecasting big growth in earnings and revenues from the year-ago quarter. Wall Street analysts are expecting earnings per share of $0.43 cents, or 28 percent year-over-year growth, on revenues of $4.5 billion, a 39 percent increase over the same quarter last year, according to a survey from Thomson FirstCall.”

“While analysts expect strong year-over-year growth in iPods once again, they do not think that will be the case with Mac sales,” Cantrell reports. “Wall Street analysts are forecasting sales of roughly 1.2 million Mac units in the quarter, up just slightly from the 1.07 million Macs Apple sold in the same quarter last year. While the March quarter is traditionally slower than December, given December’s holiday sales, the new Intel-based machines may have given shoppers an incentive to buy. It remains to be seen whether they took the bait, however, especially since availability of the first Intel-based Mac laptop, the MacBook Pro, was severely constrained for the first month after it began shipping on February 14, according to Piper Jaffray analyst Gene Munster. He estimates that Apple was only able to meet demand for about two weeks in the quarter.”

“‘The iMac and the MacBook Pro are doing well; we are still hearing sales for the (Intel) mini are kind of lukewarm,’ said Shaw Wu, an analyst with American Technology Research. Wu thinks Apple’s BootCamp software, released in April, will accelerate Mac adoption, since it allows users to run both Windows and Mac operating systems on their Macs, thereby eliminating a barrier to the Mac world for people who need to run Windows-only applications for work or school but still want to buy a Mac. But that acceleration will take some time, Wu adds,” Cantrell reports. “Apple sold a whopping 14 million iPods last quarter, thanks to strong holiday sales and the introduction late in the year of both the iPod nano and video-enabled iPods. Analysts are divided on how many iPods they expect the company to sell this quarter, with estimates generally falling in the 8 million to 10 million range… Still, if Apple sells 9 million iPods, as a handful of analysts think it might, that’s still a 70 percent increase over the number of iPods sold in the year-ago quarter.”

Full article here.

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Related articles:
Cowen & Co survey shows strong Apple Mac sales prospects, Boot Camp impact ‘broadly positive’ – April 18, 2006
What are your expectations for Apple’s earnings report this Wednesday? – April 17, 2006
Apple FY 06 Second Quarter Results Conference Call this Wednesday – April 17, 2006

24 Comments

  1. Do I read this correctly?

    “While analysts expect strong year-over-year growth in iPods once again, they do not think that will be the case with Mac sales,”

    = iPod sales strong; Mac sales weak.

    “Cowen also surveyed the impact of Boot Camp on Mac mind share and found it to be broadly positive. However, that survey view of forward 12 to 18 month [iPod] demand is clearly weaker.

    = Mac sales strong; iPod sales weak.

    In other words, flip a coin or shake the 8-ball for more consistent analysis.

  2. Weird how everybody always talks about how they think the iMac is outselling the Mac mini (which is what Apple would want everyone to think), and yet I don’t know any single solitary living soul with an iMac, but I know six people who bought Mac minis.

    Since Apple doesn’t ever break out sales by model, anyone who says the iMac is outselling the Mac mini is pulling it out of their ass.

  3. I have loaded up on Puts AND Calls. I think this thing is going to move strong one way or another. Unlike these assholes on Wall Street, I’m not arrogant enough to think I can tell the future.

  4. Interesting Joop. I helped 4 people switch recently, 3 bought Intel iMacs and one bought an Intel Mac Mini. I’m also in the process of helping my cousin switch and get a Mac Book Pro.

    On Amazon.com, their top Intel Mac sellers are as follows:
    1. Mac Book Pro 2.0Ghz
    3. Mac Book Pro 1.83Ghz
    4. Mac Mini Core Duo
    5. iMac 20″
    7. Mac Mini Core Solo
    8. iMac 17″

  5. I expect mac mini sales to remain slow. The new pricing takes it out of it’s niche. It was within stricking distance of the dell lowend machines. Now it is just too far away to be compared with those machines. The higher end machine is too close to the more useful iMac but does not have the same performance specs.

    Apple needs to find a way to shave $100 back off the lowend machine. The highend model needs a few performance upgrades. First and formost the video needs to be upgraded. Second, the HDD needs to be increased in speed and capacity.

    Apple seems to have realized that the mini appeals to two different segments of the market. The bargian shoppers where the $100 matters. The other market was probably a surprise to apple initially – A lot of mini’s were being upgraded to their max levels as people wanted a small mac, not neccisarily a cheap one.

    Apple set the bar pretty high with the iMac and Macbook pro and the mini just dos not seem to be in the same ballpark. once you max it out you are in striking distance of an iMac. Apple needs to upgrade the graphics and add a 1/2 inch to each diminsion on the higher end model so they can accomidate a 3.5″ HDD and get better performance/capacity while reducing the cost to offset the graphics chip.

    These changes would move apple back to the mainstreams that drive the mini market, wrather than being positioned between them as it is now.

  6. “I don’t think your individual observation or mine mean squat.”

    Yes but, your name is justified. That gives you the advantage. ” width=”19″ height=”19″ alt=”tongue laugh” style=”border:0;” />

  7. I don’t think your individual observation or mine mean squat.

    That’s the point. Since Apple won’t ever release the sales figures by model, how can anyone possibly know? Your real-world observations are different from mine and which are different from his. Who’s right? Only Apple’s accounting department knows for sure…and they’re not telling.

  8. MDN, nice job sliming on the new hypertext ads. Real smooth, like. Now we have to dodge hypertext minefields that pop up and block text we were actually trying to read. This site is going to go off the bookmarks if this crap continues. This page is already loaded with ads, now there’s more. Enough already.

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