

Apple Reports First Quarter Results - aaronbrethorst
http://www.apple.com/pr/library/2011/01/18results.html

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archgrove
One interesting figure is: 16.24 million iPhones versus 7.33 million iPads +
around 10 million iPod Touches. That's around 17 million non-iPhone iOS
devices versus around 16 million iPhones, and illustrates why increasing
Android sales don't seem to dent iOS sales/usage statistics as much as the
phone OS debate might suggest. Most iOS devices being sold are, in fact, not
iPhones!

~~~
danielrhodes
Totally. Non-phone iOS devices are the elephant in the room and drive an
incredible number of app sales. For example, if you look at the top selling
apps in the App Store, they are mostly games that are being downloaded on iPod
Touches.

~~~
nostromo
Not sure I follow. How do you know those games are being downloaded on iPods
and not iPhones?

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catch23
From those stats we don't know, but app developers do know. I would say there
are actually significantly more ipod app sales than iphone. It depends on the
app, but the app developers that I hang out with tend to have more sales on
ipod devices.

~~~
nixy
How do they know? I am an iOS developer and there is no way of seeing whether
my apps are downloaded to an iPhone or an iPod (afaik).

Edit: That is, from iTunes Connect. Maybe your pals use some sort of usage
logging/statistics from within the app.

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bni
Users that mail you for support or hints, I generally ask them what device
they use. There are a lot of iPod touches out there.

~~~
ZoFreX
Maybe iPod touch users are stupid? In all seriousness, that's not a very
rigourous way of polling.

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kprobst
$6 billion profit on almost $27 billion revenue... that's almost 50% YTD.
That's insane. And 62% of that from outside the US.

Say whatever you want about Apple, but they know how to print money.

~~~
blantonl
they also know how to sit on that money as well... which has quite a few
investors pretty antsy.

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muhfuhkuh
I think that, for now, their $130 share gain in the last 52 weeks is more than
making up for it.

They can talk dividends when their shares are near Microsoft's level and their
product pipeline is less stacked and hype machine is dying.

~~~
patrickk
I'm re-reading Peter Lynch's classic "One up on Wall Street" at the moment.
He's a big advocate of share buybacks over dividends (unless Apple can some up
with something else to do with the cash.) Warren Buffett is also.

Buybacks reduce the number of shares outstanding in the market and thereby
increase earnings per share, which boosts the share price, rewarding existing
investors. So we may see Apple engage in buybacks.

~~~
blantonl
We probably won't see buybacks and dividends any time soon. Apple remembers
the days when they almost went bankrupt and that has set the tone for how they
manage financially. They are very conservative with their cash.

They have made it very clear that they are reserving that cash for a big
acquisition. IMHO that means that they are waiting for the moment when someone
innovates in a way that threatens them and they can bring the talent and
assets aboard. Like the Google process, except you pay with cash.

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rkudeshi
Noteworthy: Apple "analyst" Gene Munster predicted 4.3 million iPads sold in
2010. (<http://read.bi/cYCppW>)

Actual results: 7.33 million just last quarter.

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evgen
"Analysts" who go contrarian on Apple are fairly common, and they have spent
the past decade being wrong. At this point low-balling Apple has become so
common that I think a lot of analysts do this just in case they manage to draw
the lucky lottery ticket and "predict" a miss by Apple -- if they are correct
their prediction stands out and when they are wrong they just get filed into
the long, long list of bad Apple predictions.

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ra88it
If they are correct then their prediction is still just part of the long, long
list. Why would it stand out?

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mikeryan
Watching the Apple share price graph over the course of 7 days starting with
Steve's step down announcement yesterday through the earnings call today is
going to be a _really_ interesting exercise on timing bad news.

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shinkansen
I couldn't help but notice the timing too. Steve steps out just as Apple is
about to post phenomenal earnings: smart moves on Apple's part I think.

~~~
patrickk
If Steve is really sick then it's probably just a coincidence. He's a genius
but not god.

~~~
jacquesm
Yes, it probably is just a coincidence that Steve Jobs' illness recurs just
when Apple profits are this high.

But on a more fine grained timescale a few days more or less in the timing of
the announcements might make quite a difference in how people perceive this.
If they had announced a month ago instead of right next to record quarterly
earnings it might have hurt the stock more at the time than it does today.

The market is in theory 'efficient', but in the short term it tends to
overreact to bad news, so combining bad news with extremely good news may be a
viable method to offset the effect of the bad news on the stock.

Savvy investors will have priced Steve Jobs health in to their stock holdings
already, those that are on edge might panic and sell unless there was a second
factor.

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zmmmmm
16 million iPhones over 90 days is 178,000 / day.

This is getting down to near half Android's claim of 300,000 / day (not all
phones, but one would presume nearly all).

Of course, add in the other iOS devices and Apple is back in front, but it's
interesting to see how far behind Android they are in the phone market now.

~~~
jonhohle
That claim was also made during the middle of the holiday season. I'd wager
activations have cooled off since then.

~~~
Samuel_Michon
Right, and the numbers themselves are kind of dubious, too:

On Dec 6, Andy Rubin blogged that there were 200,000 activations a day. On Dec
8, Andy Rubin tweeted there were 300,000 activations a day.

[http://googleblog.blogspot.com/2010/12/introducing-nexus-
s-w...](http://googleblog.blogspot.com/2010/12/introducing-nexus-s-with-
gingerbread.html)

[http://tech.fortune.cnn.com/2010/12/08/andy-rubin-google-
act...](http://tech.fortune.cnn.com/2010/12/08/andy-rubin-google-
activates-300000-phones-every-day/)

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pohl
The earnings call started a few minutes ago...

<http://www.apple.com/quicktime/qtv/earningsq111/>

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ugh
By the way, not one question about the health of Steve Jobs.

~~~
ffffruit
One would hope that his last sentence regarding his and his family's privacy
would be respected.

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ffffruit
I am happy for them. Apple is a company that puts design and user experience
at the front and they get rewarded for it. I see their revenue as generated by
genuine consumer appreciation compared to the generic ad revenue that other
companies generate.

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timdellinger
They obviously knew that this would bump the stock price up, which is why
Steve's step-down announcement was timed to effect the market on the same day.

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imkevingao
very good strategic planning. Releases the report right after Steve Jobs steps
down, I am pretty positive that Steve Jobs knew this report, thus knowing that
it'll be safe to step down with this type of amazing results being reported to
the public

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erikstarck
The value of Apple soon surpasses the GDP of Sweden.

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bane
Phenomenal. I'm not sure I can put together a comment that's much more than
that.

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mobl
They're hitting $1000 share price this year. :-)

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kprobst
I hope not, that would kill their P/E ratio.

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ergo98
Apple is simply printing money now. Remarkable financial success.

It is notable that between Q4 2010 and Q1 2011 (the latter includes the
holiday season), the growth areas were the iPod [115%] and the iPad [75%].
Macs increased 6%, but actually decreased by 7% in the Americas.

It's hard to hold it as a "bad" result, but among such stellar results the
relatively small 15% growth of the iPhone does stand out. Tomorrow the talking
heads will probably play that up despite the incredible scale of these
results.

~~~
wiredfool
It's really hard to look at quarter to quarter numbers and say that it's good
or bad when you have the holiday buying season involved. It's better to look
Year on Year (except for the iPad)

There's also different bits of the product lifecycle to consider. Ipods were
refreshed in September, (probably in anticipation of the holidays), but
they're down year on year. Iphones are nearing the mid point of the yearly
cycle, and I'd expect them to be relatively flatish until summertime. (except
for that whole verizon thing). Ipads should be mostly flatish, since world +
dog expects a refresh in April. The fact that the ios devices aren't flat is
saying that there's a huge demand for these things that hasn't been filled
yet.

~~~
tsotha
>Iphones are nearing the mid point of the yearly cycle, and I'd expect them to
be relatively flatish until summertime.

I wouldn't expect that, at least not this year in the US. The iPhone goes non-
exclusive here in a week or so as it hits Verizon stores. Most people are
expecting a big jump in sales from Verizon customers who wanted iPhones but
didn't want to switch to AT&T.

~~~
Samuel_Michon
Also:

1) During the conference call, CFO Peter Oppenheimer stated [1] that Apple
still can't handle demand for iPhone and they continually have to increase
production.

2) Apple keeps adding partnerships with operators in various countries, the US
is just a piece of the pie. They currently have agreements with 185 operators
in 90 countries, but that's probably not even half of the major operators out
there.

3) Sales are growing fastest in the Asia-Pacific region and Japan. IPhone
sales doubled year over year in those regions and I doubt that's going to slow
down, also because of Apple's marketing efforts there. For instance, Apple
plans to open another dozen Apple Stores in China in 2011. It was also stated
that the China retail stores are the ones with the highest revenue per store.

[1]
[http://www.macworld.com/article/157196/2011/01/apple_financi...](http://www.macworld.com/article/157196/2011/01/apple_financials.html)

