
Apple Sells Three Million iPads in Three Days - drp4929
http://www.apple.com/pr/library/2012/11/05Apple-Sells-Three-Million-iPads-in-Three-Days.html
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simonh
When Apple's share price took a hit on the announcement of iPad Mini pricing,
apparently it was because the analysts though the price was too high. Note -
not because Apple's margins were going to be lower on the iPad Mini (which
they are), but because they weren't cutting their margins by enough! Given the
Apple will sell these things as fast as they can make them, Wall Street was
effectively upset that Apple would be making too much money.

This from a company who's whole strategy is about being the upmarket, high
margin option. They're so obviously leaving a price umbrella so that next year
they can price-drop the current version when the next iPad Mini comes out and
still make money hand over fist, while also leaving the opposition nowhere to
go price wise.

They release a blockbuster refresh of their main products and gear up to make
more money than ever before and their stock price dives 12%. Unbelievable.

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ajross
No, the fear was that long term the sales of the mini would cannibalize sales
of the higher-margin iPad and reduce net margins in a market that is
approaching saturation and seeing increasing competition. Obviously that
effect isn't going to be apparent in launch-day numbers like this (basically,
you'd need to wait to see if the mini owners buy another iPad for that).

But you can believe that "Wall Street was effectively upset that Apple would
be making too much money" if it makes you feel better. I'm sure those fund
managers stay up late at night worrying about beating their targets...

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simonh
I think it will cannibalise sales of the higher margin iPad, but that ceding
the medium form factor market to 7" Android devices would be a bigger long
term risk.

In this sense I agree with the analysis that Apple needed to introduce a lower
cost medium form factor tablet for strategic reasons. I just expect them to do
so in two phases, in exactly the same way that they have with previous
devices. That is, introduce the new device at it's premium price point this
year, and then move the year old device down to a lower introductory price
point the year after.

In other words I agree with the argument that the introductory iPad Mini
should be under $300. I just think that next year is when that should happen
and jumping the gun would be a panicky amateur move that Apple would be idiots
to make.

Long term iPad margins will be lower than they have been up to now, but that's
inevitable one way or another and Apple are doing a great job managing the
transition.

~~~
ajross
I should point out that I completely agree -- this is a market Apple needs to
play in, the Android boxes are great too and providing huge price pressures,
and Apple's margins absolutely will shrink in the future. And all of that is a
good thing for all of us.

Nonetheless from the perspective of an Apple shareholder, it's a "bad" thing,
and in the short term you'd expect their stock to reflect that.

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jusben1369
Couple of quick questions: a) Interesting they're not breaking it out between
the two given substantially different models and price points? b) The two
questions about the Mini are i) does it cannabalize the higher margin "normal"
iPad sales and ii) does it slow down Nexus/Fire Android tablets? If it does i)
and not ii) then it's arguably a failure. If it does ii) and not i) it's a
wild success. Without a break out here between the two models it's really hard
to know how to judge these numbers.

I most interested in day 30 - 100 when the initial buzz wears off.

~~~
malay
Even using current run rate sales of the Nexus tablet, they would only be
selling 3M a quarter. Apple sold 3M tablets in a weekend. If only 20% of the
reported sales were for the iPad Mini, it is doubtful Apple will be outsold in
the holiday quarter (even with giving competitors the extra month), especially
considering its distribution reach. However, we'll never know, since neither
Google nor Amazon release sales figures (Asus reported the Nexus number).

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smackfu
OTOH, I think everyone agrees that Apple is manufacturing constrained on these
things. How long did it take to manufacture those 3M iPad minis? If it takes a
month to make what sells in 3 days...

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malay
While I agree they are still heavily supply-constrained, the CapEx figures
that Apple has released indicates they are significantly ramping up
manufacturing capacity. They have sold more than 15M iPads in a quarter
before. I would be surprised if they didn't have the capacity to sell 20-25M
this holiday quarter.

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toksaitov
At first I thought it’s a pointless device for me, but after several hours
with it I think it’s one of the greatest casual gaming devices on the market.
The screen of iPod and iPhone is too small and ‘the new or whatever’ iPad is
too large by itself. This holiday season it’s a much better choice as a
present for kids than iPod touch.

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ZanderEarth32
It's interesting how all of a sudden with the option of having a smaller iPad,
the "old" iPad has become much to large for a lot of people but when the
smaller device was just a rumor a lot of people didn't feel they could fit it
in their life. Fascinating how just a few hours with the device are changing
people's preferences on the entire tablet market.

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ZeroGravitas
Every year the old version of Apple products become surprisingly worse in the
space of a few hours as the new products get released and flaws that the
community couldn't previously acknowledge become validated, and even
accentuated in light of the new version.

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arrrg
Apple moves at a steady and surprisingly predictable pace (at least once they
have introduced a new product). They have a small lineup and they often
replace products instead of continuing to sell both products. They take good
care of making sure that they never have too many or too similar products.

For me those are great virtues. Those are things that make Apple a great
company that understands me.

Those are also things that make some people claim that Apple is running some
sort of scheme to always get you to buy the newest stuff. I think that’s a
bullshitty strawman.

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ditoa
It is amazing how well Apple has done in growing so massively during a world
wide economic downturn/depression.

~~~
purephase
I think a case could be made that the near-constant consumer demand around
Apple products is contributing to the increase of consumer debt which, in
turn, is one of the largest contributors to the "depression".

I'm not saying they're the only ones to blame here, all consumer electronic
companies are doing the same thing, but they're certainly the largest player.

Forced obsolescence around devices that are largely unchanged from one version
to the next is not new, but the pace is insane. People are bored days after
purchase.

We're sitting on a mountain of tulips. Exploitive, environment damaging
tulips.

~~~
Osmium
> I think a case could be made that the near-constant consumer demand around
> Apple products is contributing to the increase of consumer debt which, in
> turn, is one of the largest contributors to the "depression".

There's a big difference between consumer debt (often held locally) and
national debt (held overseas). I'm not sure consumer debt is as big an issue
as you think.

~~~
purephase
It absolutely is. Increased borrowing to finance consumer spending is largely
responsible for the 2007 crash. Sure, the banks made terrible loans and tried
to double-down on them, but borrowers are just as responsible.

How many people are using straight-up cash to purchase these devices? They're
likely putting them on credit and that credit burden is hardly isolated. In
real terms it means that they cannot afford that one extra mortgage/student
loan payment, or invest in retirement/savings or kids education.

Arbitrary low interest rates create false security. We are not out of the
woods and unless we start to reverse these trends, we're set for another
crash.

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tamping
And this is only the wifi models of the iPad mini - the 4G ones are coming in
a few weeks. Impressive.

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donniezazen
Wow! Where does all these customers come from? It seems a lot of consumers buy
these products just because they have to have latest Apple gadgets.

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VexXtreme
This is a big part of it. I talked with a buddy of mine recently who is a big
fan of Apple products and owns pretty much every Apple product out there. At
some point we started talking about the latest iPad and he said "Man, despite
already having iPad 3, I am going to buy this. Not because I need it, but
because I have to own it". I know more than a few people who think that way.

I'm not going to pass judgment because I've personally burned a lot of money
on expensive gaming machines just because I wanted to play games on the
highest settings. Everybody derives pleasure and satisfaction from different
things and if burning tons of cash on Apple gadgets makes someone's life
better and more enjoyable... more power to them.

~~~
tjogin
Your friend probably represents less than 1% of Apple's total customers. He's
not a "big part" of it. That you _know him_ doesn't mean that all of Apple's
millions and millions of customers are anything like him.

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adjwilli
Does that number include pre-orders? Because really it would be 10 days since
preorders began, not just three.

~~~
talmand
I would assume it includes the pre-orders, because if it did not then I would
guess we would see a headline more like: 3 million iPad Minis in three days
PLUS another two million (or whatever) in pre-orders!

Regardless, that's an impressive number for a device that already had well
established competition and Steve Jobs claiming nobody wanted it.

EDIT: oh wait, that's 4th gen and iPad Minis combined? I thought it was for
just the mini. Are there numbers out there about how the mini sold? I don't
see it broken down in the press release unless I totally missed it. I think
it's a bit unfair to say that the latest iPad and the mini doubled the number
sold of the previous iPad since that's comparing the totals of two products
against one. Still, impressive numbers.

~~~
__chrismc
If it's anything like the iPhone 5, it'll be the total number delivered into a
customer's hands - which will include some pre-orders but not necessarily all
of them.

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newman314
I personally think it's interesting that what would otherwise be a STUNNING
sales feat (for just about any other company) is greeted as merely okay or
downturnish.

IMO, it would be hard for me to think of any company that would not consider
this a successful launch.

Sure there's talk of cannibalizing of larger iPad sales but for me the larger
iPad was not that interesting due to having to carry a laptop AND a tablet is
painfully heavy (it adds up). I was debating waiting for a Mini with a Retina
display but decided early Friday morning to just pick one up.

This is my first ever iOS device and in the days since last Friday, it's been
fun to use, is the right form factor for my use cases and frankly, I'm happy
with my decision. YMMV.

Now, my next most pressing problem is to find a case for it... Suggestions
anyone?

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ChuckMcM
Funny how poorly that page renders on an iPad :-) Wish they would break out
4th gen sales. I agree with many folks that first weekend bookings of a trendy
device make for good press and poor investment research. The jan-mar quarter
is a better place to try to divine how effective there strategy is wrt to the
tablet market.

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ocean12
I think this goes to show that the tablet market that Apple is playing is both
different and not as price sensitive as the one Google, Amazon, etc are
playing in.

After January 1st, there will (probably) be sub-$300 "good as new" iPad minis
available as refurbished devices in the Apple Store too...

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victorantos
there are 4.5 mln android devices sold every 3 days

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35636
A dozen versions, sold by dozens of manufacturers. Android is so fragmented
it's hard to actually consider it a single thing. It's like saying "4.5
million computers are sold every 3 days".

The iPad is one thing, made by one company, that comes in two sizes.

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josteink
With different resolutions, different storage capabilities, different
memorysizes and computational capacity. Some with mobile broadband, some
without.

Which may be used with or without accessories such as a keyboard or stylus.

One thing indeed.

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shinratdr
Why would a developer have to account for varying storage, mobile broadband,
or Bluetooth accessories like a keyboard or stylus?

As for resolutions or RAM, I think we can all agree 2 is simpler than all.

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yakshay
Apple sales are high due to international availability, and thats no ordinary
feat. It would interesting to see US only numbers.

I liked the old Apple, which out-sold the competition just on their product
and product differentiation.

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benliong1
Apple's playing in a market that is much more competitive than the PC / MP3
player market though, with competitors working on vastly different business
model and undercutting on product whenever they can ...

I for one am glad that Apple is so much more international than Google and
Amazon, because I live outside of US.

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m0skit0
I've lost faith in humankind. I can die with peace at least.

