Live notes from Apple’s Q211 Conference Call in reverse chronological order:
• End of conference call.
• Samsung lawsuit: Apple is Samsung’s largest customer. Apple expects the relationship to continue. Apple tried to resolve issues with Samsung mobile products division but decided that they had to resort to the courts.
• For competitive reasons, Apple will not divulge how many iPhone sales are to current iPhone users vs. new-to-iPhone buyers
• Cook: iPhone 4 in supply-demand balance virtually everywhere; as is Mac and iPod; iPad currently experiencing “The Mother of All Backlogs.”
• Cook: I wish we could have produced a lot more iPad 2 units during Q2 because there were certainly a lot of customers waiting for them.
• Apple Inc. (AAPL) after-hours trading: $354.29, +$11.88 (+3.47%) @ 5:30PM EDT
• Cook: Extremely pleased with iPad 2 manufacturing product ramp; going better than original iPad ramp
• During quarter, Apple drew down 1st-gen iPads by 570,000 units and added 170,000 new iPad 2 units (most of those were in transit at the end of the quarter).
• Cook: Steve Jobs remains on medical leave, but we do see him on a regular basis, he remains very involved in making major strategic decisions, and I know he wants to be back full-time as soon as possible.
• Cook: Apple feels very, very good about where they are and great about future product plans.
• Cook: iOS platform outreaches Android platform by 59% in U.S (comScore). iPhone’s integrated approach is materially better than Android’s fragmented approach.
• Apple expects to spend $5.7 billion in fiscal 2011; expects for spend about $3.5 billion on prepayment and capital expenditures on three component suppliers with $900 million of that having been spent in Q211.
• Apple is constantly looking at where they should bring on iPhone carriers
• Cook: iPad 2 supply issues: Staggering demand. Will not predict when supply and demand will come into balance.
• For competitive reasons, Apple will not provide ASPs for individual product lines.
• Cook: iPad has clearly created a “halo effect for the Mac.”
• Oppy: Apple priced iPad very aggressively to capitalize on the company’s first-mover advantage
• Cook: With Mac, Apple seems to be the only company willing to invest in making innovative products
• Cook: U.S. Mac sales up around 25% YOY; 20 quarters in a row, the Mac has outgrown the PC market
• Cook on 4G; The first generation of LTE chips forced a lot of design compromises in competitors handsets some of which Apple’s just not willing to make.
• Cook: iPhone 3GS for US$49 was “very popular. It did very, very well.”
• Apple did just under $5 billion revenue in China revenue during quarter
• iPhone sales “off the charts.” 155% in U.S. YOY (adding Verizon) and “on a tear in China” about 250% iPhone sales growth.
• Cook confident that Apple can “produce a very large number” of iPad 2 units during Q3.
• Cook: iPad 2 “heavily backlogged.” “Extremely pleased with ramp up.” 13 more countries next week.
• Tim Cook: The Japan situation is uncertain, but Apple knows of no circumstances that are unsolvable looking at things today
• Tim Cook: Apple has not had any impact, nor does the company expect any material impact, from the Japan disasters.
• Tim Cook: Japan disasters are an incredible tragedy. Apple is very, very saddened with the situation. The economic impact pales compared to the human impact.
• 38% margins expected for Q311
• Apple expects tax rate of about 25% for Q311
• 24.2% tax rate for the quarter
• 323 Apple Retail Stores currently
• Half the Macs sold in retail stores are to customers new to Mac
• Apple Retail Stores: $3.19 billion in revenue, an increase of 91%
• Apple Retail Stores: 71.1 million visitors vs. 47 million YOY, a 51% increase
• Apple has paid over $2 billion in payments to iOS developers
• Over 350,000 iOS apps
• 189 million iOS devices have been sold so far
• Apple continues to work hard to bring iPad 2 supply in line with demand
• iPad 2 inventory below 850,000, below inventory target; Appel sold every iPad 2 they could
• 5.2 million iPhones in channel inventory; within target of 4-6 weeks of channel inventory
• iPhone now on 186 carriers in 90 countries
• iPhone revenue in quarter was $12.3 billion vs. $5.45 billion YOY
• $1.4 billion total revenue for iTunes Store.
• Total iPod sales ahead of Apple’s expectations; 73% market share (NPD), 5-6 weeks of channel inventory
• Mac OS X Lion, developer preview released during quarter, schedule to ship “this summer.”
• 3-4 weeks of Mac channel inventory
• Oppy: Extremely popular MacBook Air and MacBook Pro drove Mac sales increases
• Present at Conference Call: Apple CFO Peter Oppenheimer, COO Tim Cook, Treasurer Gary Wipfler
• In after-hours trading, shares of Apple Inc. (AAPL) are currently up $9.99, or 2.92%, to $352.40
• CFO Oppenheimer Q311 guidance: “revenue of about $23 billion” and “diluted earnings per share of about $5.03”
• 95 percent quarterly profit growth
• 83 percent quarterly revenue growth: Largest ever in company history
• 4.69 million iPads sold during the quarter, as iPad 2 ramped up amidst heavy demand
• 9.02 million iPods sold during the quarter, representing a 17 percent unit decline from the year-ago quarter
• 18.65 million iPhones sold during quarter, representing 113 percent unit growth over the year-ago quarter
• 3.76 million Macs sold during quarter, a 28 percent unit increase over the year-ago quarter
• International sales accounted for 59 percent of the quarter’s revenue
• Gross margin was 41.4 percent compared to 41.7 percent in the year-ago quarter
• Versus revenue of $13.50 billion and net quarterly profit of $3.07 billion, or $3.33 per diluted share, in the year-ago quarter
• Record second quarter net profit of $5.99 billion, or $6.40 per diluted share (vs. $5.37 EPS)
• Record second quarter revenue of $24.67 billion (vs. analyst consensus estimate of $23.38 billion)
• Live coverage begins at 2pm PT/5pm ET today, Wednesday, April 20, 2011.
Related article:
Unstoppable Apple beats Street with record $24.67 billion quarterly revenue – April 20, 2011
We know where this is going and it is summarized in the word “up”.
But I don’t see any race cares in Apple’s rear view mirror.
That makes it even easier for Apple to surge.
AT&T just reported 3.6M iPhone activations, 1M more than last year, or about 38% more.
ATT sux downtown Chicago. iPhone,2 3G, 3GS,4…. Doesnt matter!
AAPL currently up 8 after hours..
NOW…more than that up 12!
After Hours $355.17
Change +12.76 +3.73%
$ 342.41
Change
+4.55 +1.35%
Day high
$341.50
Open: 343.51
AAPL currently up 8 after hours trading..
wow… They beat consensus by 1.29B!
AAPL is on amber fire as this is just da begining of bigger numbers. The stock will be at $522 by da end of 2012 🙂
December: AAPL =
2011 = $422
2012 = $522
2013 = $624
2014 = $725
2015 = $828 US dollars 🙂
BUY bye < $400 and ur money doubles by 2015 🙂
It’s unbelievable how many iPad were sold during the quarter when iPad 2 was only available for a few weeks (and not in all worldwide markets for most of that time).
Imagine what the number will be this (2nd calendar) quarter, when it is sold for the entire quarter in most of the major markets AND supply is less constrained. Apple may sell more iPads than iPods!
Only 4 million iPads? What a disaster. Apple needs to get their damn production issues sorted out already.
Note that the quarter ended mar 26, iPad sales listed… Include iPad and 2 WEEKS of iPad 2’s.
Mike “effing” Abramsky, just asked how the iPhone v Android battle isn’t like PCs in the 80s. What a ‘tard.
> Cook: iPhone 3GS for US$49 was “very popular. It did very, very well.”
The Apple Store has fine print that says it costs $449 to buy one “as a gift” (no two-year contract). That means Apple probably received up-front subsidy from AT&T of at least $400 for each of those “very popular” iPhones. That’s pretty good revenue on a tech product that is almost two-years old.
So what does Apple do after “iPhone 5” is released? I doubt iPhone 4 will become “last year’s model” at $49 (with two-year contract); iPhone 4 is still very advanced and likely to be too close in appearance, specs, and features compared to the new model. And I doubt Apple will continue making and selling iPhone 3GS for another year. Makes me believe the rumors about an entirely new low-end iPhone model…
Considering the value of a 2 year data contract to ATT (more than $2K), I don’t doubt that $400 per phone makes sense, but I bet ATT is paying less than that. As for the iPhone 3GS, it’s still a pretty damn-good smartphone. I’m still using mine until iPhone 5 is out. I don’t see why Apple can’t continue producing as long as carriers have customers looking for a bargain. It’s win-win for Apple and ATT whenever any customer buys any model of iPhone. And I wonder how Apple could produce a “low-end” iPhone any cheaper than continuing production of the 3GS. They’ve already absorbed the cost of those production lines.
If Apple produces an iPhone 3GS for another year, Apple has to support it in iOS for another year. That means, assuming there is one major release per year, iOS 6 (next summer) must fully support iPhone 3GS and iOS 7 (summer 2013) must at least partially support it (provide support as long as the last one sold as “new” is still under a two-year contract).
It think Apple will want to phase out support for the older type processor, lower system RAM, and “non-retina” display sooner than that, to advance the OS and other software at a fast clip while minimizing platform fragmentation (and NOT have “legacy” hardware support be a drag).
My speculation is that a completely new low-cost iPhone will emerge that is NOT really an “iPhone,” just as the first iPod shuffle was called an “iPod,” but it was not really an iPod. It may be called “iPhone something,” but it will be clear, based on appearance, features, and marketing, that is it a distinct product.
Customers who want a “real” iPhone will not buy it, just as someone who wants an iPod touch is not going to get a nano or shuffle instead. It will be a MUCH higher distinction than iPhone 3GS compared to iPhone 4. In this way, it will NOT take away from sales of the latest and greatest fully-subsidized iPhone, as the iPhone 3GS probably does now. And it will not hamper the continued advancement of the “real” iPhone and the iOS platform (and not add to fragmentation for third-party app development).
If they can make an iPod touch with the same cpu and screen as the iPhone 4 for $229, I’ve got to believe that they can roll out a pretty good, no-contract iPhone for a very reasonable price, say between $200 – $300. Let the telcos sell it for “free” with a two year contract.
As long as it can run most App store apps, the iPhone 3 screen resolution would not be a problem.
Say, does anybody out there know alchemy? I’m sure Apple COO, Tim Cook, would greatly appreciate someone converting “channel stuffed” Galaxy Tabs, Motorola Xooms and RIM Play Books into iPad 2s to relieve “the mother of all backlogs”. Thanks. 😉
Ok, so I may be doing the math wrong, but with 155% growth in US iPhone sales that puts them at about 4.1 million iPhones sold in the US for the quarter(AT&T claims 3.6 mil new activations a 33% YOY increase that means they had 2.7 mil in the year ago quarter. Multiply that by 1.55 gets you to around 4.1 mil) That would tell me that Verizon only sold aroung 600K iPhones (I do realize that AT&T activations differs from Apples units sold). Am i missing something in this number?
The iPhone/iPad tracking your whereabouts made the local news in Minneapolis.
AAPL just broke +14 after hours!
Did anyone ask how many AppleTVs were sold?
If Apple doesn’t break out that number “for competitive reasons” where is it hidden?
Mike Abramshy by the way works for RBC, which is a major shareholder of RIM and also has seat on the RIM board if I am not mistaken.
They didn’t state how much cash was added this Qtr. What might they not want others to know?
Believe I read $6.1 B in the CC transcript. $ 65 B total) Should be in the press release.
iPad has clearly created a “halo effect for the Mac.”
Yes it has.