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Apple Q3 2007 Financial Results on July 25, 2007

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Apple will be webcasting a discussion of their Q3 2007 Financial Results on Wednesday, July 25, 2007. As usual, the following disclaimer is given:

Please note that comments made during this call may include forward-looking statements that are subject to risks and uncertainties, and that actual results may differ materially from these forward-looking statements. For more information on the factors that could influence results, please refer to Apple’s SEC filings.
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The conference call begins at 2pm PT, 5pm ET.

Apple's 3rd financial quarter of 2007 began on April 1st and ended on June 30, 2007. While the iPhone was only on sale for 2 days during the quarter and those revenues will be spread over 24 months according to Apple's subscription based accounting system for iPhone and Apple TV, analysts believe strong Mac sales will lead to expectation-beating results (via AppleInsider's analyst coverage).

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https://www.macrumors.com/2007/07/23/apple-q3-2007-financial-results-on-july-25-2007/
how the heck is the AppleTV spread over 24 months too? There is no contract, it's a completely separate product. 🙄

EDIT: huh, I guess that was an internal accounting shift from Apple. A subscription-based accounting scheme would imply something is in the pipeline for the AppleTV...
 
Grimace said:
how the heck is the AppleTV spread over 24 months too? There is no contract, it's a completely separate product. 🙄

EDIT: huh, I guess that was an internal accounting shift from Apple. A subscription-based accounting scheme would imply something is in the pipeline for the AppleTV...
Click to expand...

Might be because the :apple:TV and iPhone are a different part of Apple,Inc. apart from the computers accountingwise.
 
Grimace said:
how the heck is the AppleTV spread over 24 months too? There is no contract, it's a completely separate product. 🙄

EDIT: huh, I guess that was an internal accounting shift from Apple. A subscription-based accounting scheme would imply something is in the pipeline for the AppleTV...
Click to expand...

It mostly means Apple has the right to add functionality to existing AppleTVs without having to jump through ridiculous hoops like the $1.99 WiFi upgrade.
 
Looking forward

Well, on Wednesday we should get the answers to three important questions:

1. How much does Apple get out of every monthly bill?

2. How many iPhones were sold?

3. How did the rest of the profit centers do during the quarter and was there a halo effect? I.e. was there significant erosion to the iPod market. If there wasn't, watch out. AAPL goes higher. 🙂
 
Grimace said:
how the heck is the AppleTV spread over 24 months too? There is no contract, it's a completely separate product. 🙄

EDIT: huh, I guess that was an internal accounting shift from Apple. A subscription-based accounting scheme would imply something is in the pipeline for the AppleTV...
Click to expand...


AppleTV is about to get movie rentals!!!
 
Does anyone think this is going to be MORE then a financial conference....? 😉

Have they ever done this before...?
 
ajhill said:
1. How much does Apple get out of every monthly bill?

2. How many iPhones were sold?
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Probably we're not going to get the answer to either of these questions. For one, the iPhone was released on the next to the last day of the quarter, and for another, I don't think Apple will ever reveal the inner-workings of their relationship with AT&T.
 
IJ Reilly said:
Probably we're not going to get the answer to either of these questions. For one, the iPhone was released on the next to the last day of the quarter, and for another, I don't think Apple will ever reveal the inner-workings of their relationship with AT&T.
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I could see it going either way. I don't believe that they will talk about how much they make on monthly fees or anything that involves AT&T, but I wouldn't be surprised at all if they announced how many iPhones they have sold.

P-Worm
 
Let's do some quick math.

2 days of iPhone sales and the related service contracts. Let's assume 500,000 iPhones. In the future, the actual figure might be less speculative, maybe even 700,000 based on AT&T's statement about over a million activations.About 2/3 of the phones at 8gb and 1/3 at 4gb, again speculative. Something like 1/2 existing AT&T customers and 1/2 new. Again speculating Apple gets $5 a month for existing and $11 for new.

167,000 4GB iPhones @ $500 @ 1/24 $3,479,166
333,000 8GB iPhones @ $600 @ 1/24 $8,325,000
250,000 ATT activations @ $5.00 $1,250,000
250,000 new activations @ 11.00 $2,750,000

Further assume a 100% margin on fees and a 50% margin on hardware sales.

Remember these are monthly figures so next quarter will have three times these values from sales from those two days alone.

Not bad for a couple of days 🙂

Rocketman
 
gnasher729 said:
It mostly means Apple has the right to add functionality to existing AppleTVs without having to jump through ridiculous hoops like the $1.99 WiFi upgrade.
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The right to add software features already exists in US GAAP. Macs are not accounted for over 24 months, neither are copies of Tiger. The problem with the 802.11n thing was that the HARDWARE was not what it was "sold" with. The spec sheet listed 802.11G, so to add N ability they have to account for it.

They could add software features (within the general remit of the original purpose) to Apple TV without having to play accounting games. But if they are going to add movie rentals etc. they might have to account for it differently.

Of course, accounting for it over 24 months also lets them show a large net loss on apple TV due to the R&D costs of the device which has it's accounting purposes too in terms of deferred taxes etc.

Also, under GAAP they aren't required to disclose WHY they choose to account for things a certain way, so I doubt we'll get any insight into this during the call...

t
 
P-Worm said:
I could see it going either way. I don't believe that they will talk about how much they make on monthly fees or anything that involves AT&T, but I wouldn't be surprised at all if they announced how many iPhones they have sold.

P-Worm
Click to expand...

It could happen but of course Apple could make that announcement at any time. In the past, they've generally sent out special press releases to tout sales milestones. On the earnings announcements they usually stick pretty close to the required disclosures and refuse to answer most other questions.
 
P-Worm said:
I could see it going either way. I don't believe that they will talk about how much they make on monthly fees or anything that involves AT&T, but I wouldn't be surprised at all if they announced how many iPhones they have sold.

P-Worm
Click to expand...

I agree, they will not mention how much they get from AT&T, no way. And they will mention the number of iphones sold, IF the number is good. And of course I bet it is. 🙂
 
We need a poll

Will Apple indicate the total number of iPhones sold to date? If so what will the number be?


My guess is no, they will not tell the exact number of iPhones sold to date. They will however indicate that more than 700,000 iPhones were sold in those 48 hours in June, that they surpassed 1,000,000 already and that they are "tracking well" towards 3,000,000 by the end of Sept.

My $0.02.
 
I'm thinking that this might not be your ordinary investor report. I think there'll be .....

NEW PRODUCTS! 😀😀😀

iMac revised, mac Mini revised... awesome!

The timing is right and they sorely need a revision.
 
mathwhiz90601 said:
I'm thinking that this might not be your ordinary investor report. I think there'll be .....

NEW PRODUCTS! 😀😀😀

iMac revised, mac Mini revised... awesome!

The timing is right and they sorely need a revision.
Click to expand...

The only "new product" that might be announced is a stock split.

Rocketman
 
All I can say is I'm SO happy I "gambled" (as my father said) with my share of my grandparents estate and bought 1000 Apple shares last July. My $53,000 is now worth $143,000.

PS. I'm selling before the conference call.
 
Wirelessly posted (Mozilla/5.0 (iPhone; U; CPU like Mac OS X; en) AppleWebKit/420+ (KHTML, like Gecko) Version/3.0 Mobile/1A543a Safari/419.3)

looking forward to hearing some good news
 
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