Live Notes from Apple's earnings call
http://blogs.forbes.com/velocity/2010/04/2...-earnings-call/
3:00 Pacific: That's it. Call's over.
2:55 Pacific: Apple won't say much about new products. Oppenheimer: "Let me reiterate we are very confident in our new product pipeline and are very excited about the coming months." That could mean a lot of things. There's no reason to think -- yet -- we'll see much going forward this year outside of the usual cycle of new iPhones in June, and new iPods in September.
2:53 Pacific: Will anyone ask about the iPhone prototype that gadget blog Gizmodo got its hands on this week? No questions about that yet. Hmmmm...
2:51 Pacific: Going forward, Apple will report the iPad like the iPhone, as a line item on Apple's data summary, Oppenheimer says.
2:50 Pacific: Katie Huberty, from Morgan Stanley, asks if Apple will "get more aggressive," with carriers to lower costs of phones and service plans. Cook: "When we dropped the subsidized price of the phone to $99 last year we were actually surprised that the mix to the 3GS was very very high and as you know that starts at $199... Price is important in the device, but there are other things that people want, such as an extremely innovative product, and all the apps, and the great OS." Translation: don't expect free iPhones anytime soon.
2:45 Pacific: Apple Chief Operating Officer Tim Cook still has nothing nice to say about netbooks. "To me it's a no brainer. [The] iPad Netbook [score] is sort of 100 to zero, i can't think of a single thing that the netbook does well... I'm personally addicted to mine and couldn't live without it."
2:42 Pacific: Mike Abramsky, is the iPad cannibalizing netbooks? iPods? Macs? Cook: "although we announced the iPad in January, there was nothing obvious in the iPod numbers of the Mac numbers to suggest cannibalization."
2:40 Pacific: AppleTV? Still the runt of the litter. Units were up year-over-year, but overall unit sales are still small. Still classified as a hobby, Cook says in response to a question from Brian Marshall, Broadpoint AmTech. "However a number of us love the product, use the product, and continue to think something interesting is there and continue to invest in it," Cook says. Translation: we're not pulling the plug on it yet.
2:35 Pacific: Apple will open two stores in Shanghai this summer. Will have 20 stores in China by end of calendar 2011.
2:35 Pacific: Richard Gardner, Citigroup asks what factors might help Apple's gross margins during the current quarter. Oppenheimer: "don't really consider component pricing to be a headwind or a tailwind... what' we think is going to occur in the June quarter is we've introduced a new product... we've been v. aggressive and to take adv. of our first mover opportunity here, and we've got some other transitions, a stronger dollar.. that's what's really gone into our thinking on gross margins."
2:30 Pacific: Cook says easing away from exclusive deals with carriers, outside of the United States, has done well for Apple. "Over the past year we've moved a number of markets from exlusive to non-exclusive, in each case we've seen our market share and number of units sold improved... that's our results we've seen so far, but we think very carefully about each of these at the country level to conclude what's in our best interests."
2:27 Pacific: Toni Sacconaghi, with Sanford Bernstein asks if Apple can quantify how much of the iPhone's year-over-year growth came from new carriers. "We don't break it out at that level of detail," Cook says. "Out of the 151 carriers at the country level, it's a good number but not a significant number, so obv. the existing carriers performed very well in addition to the adds." Bill Shope, Credit Suisse. Talk about ATT's network. "They've clearly made big strides in some areas... I think it will continue," Cook says.
2:25 Pacific: How's that app store going, Shannon Cross of Cross Research asks. Oppenheimer: "we have seen well over 4 billion downloads... over 3500 apps for the iPad alone." Also: what about your production capacity, Cross asks. "There's not a production problem, per se, but there's a good kind of issue in that demand in the U.S. was much much stronger than we predicted, so we had to push out the International launch... so we are adding capability and we'll see where this thing goes, but it has shocked us, the level of demand, at least initially, we'll see what happens from here."
2:21 Pacific: Ben Reitzes of Barclays asks: the iPhone number was "frankly staggering." Why? Cook: iPhone units in Asia Pacific grew 477% year over year. Europe grew $133%. "Some of this was led by adding eight carriers in some key countries, for example Vodaphone in the UK and Ireland," Cook says. For the first half of the fiscal year Apple just completed, revenue from greater China was almost $1.3 billion, up over 200% year-over-year.
2:19 Pacific: Ben Reitzes of Barclays asks if there's a transition coming up with the iPhone that explains why Apple is guiding down sequentially. Translation: tell us about the new iPhone. Oppenheimer doesn't take the bait, says lower average selling prices, a strong dollar, and product transitions account for the guidance, among other factors.
2:15 Pacific: Will the iPad cannibalize sales of Macs and iPads? Gene Munster from Piper Jaffray asks. Apple Chief Operating Officer Tim Cook: "In our view the last quarter there was no obvious impact on the mac of the iPod, but you can look at the numbers and judge for yourself... [in the current quarter] we don't have enough experience to come up with a judgement."
2:13 Pacific: Oppenheimer argues Apple's margins for the current quarter will dip, in part thanks to aggressive pricing on the iPad. Also: a strong dollar, a Mac portable transition, a mysterious "product transition," ... likely the iPhone. Take with a grain of salt: Apple's guidance is typically conservative. Apple has $41.7 billion in cash. Gross margin was 41.7%, well above guidance. Oppenheimer credits a stronger product mix, lower costs, and "fixed cost leverage from higher than expected revenues."
2:10 Pacific: Mac sales: Apple sold 2.94 million Macs during the quarter, up 33% from the year-ago quarter. 10.94 million iPods sold, roughly equal to year-ago quarter. That's well ahead of expectations. iTunes store delivered sales of $1.2 billion. 8.75 million iPhones sold during the quarter, an "all-time high," and better than the preceding holiday quarter, according to Oppenheimer. No hard numbers on iPad sales, but Oppenheimer says Apple "on track" to begin selling 3G version at end of this month.
2:02 Pacific: Oppenheimer begins with canned remarks. iPhone revenues doubled. Mac sales strong. Hence best non-holiday quarter ever.
2:01 Pacific: Conference call begins. Chief Financial Officer Peter Oppenheimer and Chief Operating Officer Tim Cook are on the call, as usual.
1:56 Pacific: Apple shares up $16.32, or 6.67%, to $260.91 in after-hours trading.
Guidance: Apple's guidance is typically conservative. From Apple's earnings release:
“Looking ahead to the third fiscal quarter of 2010, we expect revenue in the range of about $13.0 billion to $13.4 billion and we expect diluted earnings per share in the range of about $2.28 to $2.39,” said Peter Oppenheimer, Apple’s CFO.
The numbers are in. Apple easily beat expectations. Apple reported quarterly earnings of $3.07 billion, or $3.33 per share, compared to earnings of $1.6 billion, or $1.79 per share during the year-ago period. That's well above the consensus target of $2.45 per share. Sales came in $13.5 billlion, well above the target of $12 billion. Gross margin was 41.7%, higher than the 39.9% Apple reported in the year-ago quarter.
so, until there is multi-tasking, I guess a really functional IM app (that can run all the time
That does it. I'm reading through this entire thread tomorrow.
Good review - did you type up this post on it?
