“Apple Inc. shares climbed as much as 7% in early trading Thursday, an upbeat reaction to the company reporting a 73% increase in fiscal third-quarter profit due to growing sales of its flagship Macintosh computers and iPods,” Rex Crum reports for MarketWatch.
“Additionally, Apple reported a strong initial weekend for its highly anticipated iPhone, with shipments of 270,000 units in less than two days of sales,” Crum reports.
“‘[The] major business lines were strong, and we see multiple catalysts that will drive growth in the second half of 2007,’ Deutsche Bank analyst Chris Whitmore said. He expects new iPods and Mac computers to be released later this year,” Crum reports.
“Much of the credit for Apple’s results was given to its resurgent line of Macintosh PCs,” Crum reports. “Apple sold 1.76 million Macintosh computers during the quarter, a record for Mac sales in one quarter and up 33% from the year-earlier period. Mac sales included 1.13 million MacBook and MacBook Pro notebook PCs and 634,000 desktop Macs.”
Crum reports, “iPod sales climbed 21% from a year ago to 9.8 million units. ‘The quarter was really strong,’ said Shaw Wu, an analyst with American Technology Research. ‘Mac sales, in particular, were better than expected, and the iPod also had a strong quarter.'”
Crum reports, “‘By any normal company’s standards, sales of the iPhone in its first two days were brisk,’ said Charles Smulders, PC analyst with Gartner Inc. ‘If there is any sense of disappointment, then over-inflated expectations driven by Apple’s marketing machine are to blame.'”
MacDailyNews Take: The over-inflated expectations were driven by analysts and certain media outlets, not by “Apple’s marketing machine” which was responsible for a five TV commercial iPhone campaign, a national print ad campaign, and a few press releases. Apple’s goals have remained the same from day one and the company never predicted any iPhone number for the first day and a half of sales.
Crum continues, “Thomas Weisel Partners analyst Kevin Hunt went so far as to forecast iPhone sales of 700,000 units. Hunt called Apple’s iPhone sales ‘weak,’ and was also disappointed that the company’s target for sales of 1 million iPhones by the end of the current quarter fell below his forecast of 1.5 million units.”
MacDailyNews Take: We predict a billion ping pong balls will fall from a Chinese satellite at 2pm EDT today. We’re going to be severely disappointed as our last good one rolled under the furnace late yesterday. Obviously, it’s Apple’s fault that Kevin Hunt and other analysts suck at forecasting iPhone unit sales.
Crum continues, “On a conference call to discuss Apple’s results, Chief Financial Officer Peter Oppenheimer reiterated Apple’s goal of selling 10 million iPhones in 2008. Oppenheimer also said Apple would name its initial European wireless-network partners for the iPhone later this quarter, and would begin selling the iPhone in Europe during the fourth quarter.”
Full article here.