Apple Blames Low Mac Sales on iMac Supply Constraints

MacRumors · Jan 23, 2013

Today's quarterly results call revealed that Apple's Mac sales are down 16% compared to last year. Apple sold just 312,000 Macs per week compared to 371,000 per week during the same time period a year ago.

Peter Oppenheimer noted that Apple has experienced significant constraints on the new iMacs, and was only able to ship them during December. Without these constraints, he says, Mac sales would have been higher.

IDC estimates the global personal computer market contracted by 6% during the December quarter. We introduced the new 13-inch MacBook Pro retina display as well as our stunning new iMacs in October. As we projected a quarter ago, we were significantly constrained with respect to the new iMacs and were only able to ship them for the final month of the December quarter. We believe our Mac sales would have been much higher absent those constraints.

Apple was only able to provide 3 to 4 weeks of inventory, below its target of 4 to 5 weeks. Apple's newest iMacs have been plagued with production issues, mainly due to a new lamination process used for the displays.

Cook further addressed this in the Question and Answer section.

The best way to answer this is to look at the previous year. The difference is $1.1 billion from last year. iMacs were down by 700k units year over year. As you remember, we announced new iMacs late in October. Announced they would ship in November and December. Did ship by those dates. Limited weeks of ramping on those products during the quarter. Significant constraints on the iMac at the end of the quarter. Sales would have been materially higher without those constraints. Tried to share this on the conference call in October.

If you look at last year, we had 14 weeks in the quarter last year. 13 weeks this year. Channel inventory was down from the beginning of the quarter by more than 100k units. Didn't have the iMacs in channel. These factors bridge more than the difference between this year's sales and last year's.

Cook also mentioned a few other minor factors, including the weak PC market and the impressive sales of the iPad. Apple sold more than 23 million iPads, and Cook said that some cannibalization was almost certainly a factor.

Article Link: Apple Blames Low Mac Sales on iMac Supply Constraints

simonb76 · Jan 23, 2013

Somehow I could see that coming considering most people are tight with their money in the present economy.

2bcool2 · Jan 23, 2013

i got an 27" iMac ! yayyyyyyyyyyy

i dont like the fusion drive ... i wanted a 256gb ssd ...... i hear it spinning up and down wtf

Brian Y · Jan 23, 2013

When Apple don't count it as a sale until it's shipped and payment taken - that's going to affect figures badly. I think we all knew this though

.

Macmaniac · Jan 23, 2013

If I were a Financial Analyst I would make millions predicting **** like this. As a normal person I look at the facts and draw the same conclusion. Amazing society we live in.

Raftysworld · Jan 23, 2013

I feel like Steve wouldn't have allowed supply constraints like this to happen.

JamonBull · Jan 23, 2013

I'd also say that the insanely high price for a retina MacBook Pro (with decent hard disk space) is as larger factor in the sales drop. If they introduce Haswell models with a price drop this year plus revamped Airs I'm sure sales will rebound.

lifeinhd · Jan 23, 2013

If they had a new Mac Pro, would be even higher

mrsir2009 · Jan 23, 2013

16% down is quite a lot though, and desktop Macs make up only a fraction of the sales of portable Macs...

Brian Y · Jan 23, 2013

StellarSoul said:
I'd also say that the insanely high price for a retina MacBook Pro (with decent hard disk space) is as larger factor in the sales drop. If they introduce Haswell models with a price drop this year plus revamped Airs I'm sure sales will rebound.

If that was the case - they wouldn't have seen such high demand at launch.

It's their top of the line product, it's going to be expensive - and you could say that about anything. If the 13" MBP was cheaper it'd sell more. But that's not what Apple do.

blackhand1001 · Jan 23, 2013

I am sorry but apple sells 10 times as many laptops as they do desktops. The imac is not the reason mac sales were down 22%.

mrsir2009 · Jan 23, 2013

StellarSoul said:
I'd also say that the insanely high price for a retina MacBook Pro (with decent hard disk space) is as larger factor in the sales drop. If they introduce Haswell models with a price drop this year plus revamped Airs I'm sure sales will rebound.

I reckon the sales would have been higher if the rMBP hadn't been released - As people who are in the market for a new MacBook Pro would opt to wait for the second gen retina, due to a price slash and first-gen bugs being ironed out. Once they bring out a second gen retina with a lower price tag, and possibly make the cMBP's a tad cheaper as well, sales will go way up.

cameronjpu · Jan 23, 2013

The supposed supply chain genius engineered this problem.

1Alec1 · Jan 23, 2013

BS.

- The new iMac has non-removeable RAM, a deterrent for some users. And the SD card slot is on the back, WTF.

- It took Apple ridiculously long to update the iMac. Dell can push out an update every 2 seconds. All they have to do is make the internal components NOT over a year old. No need to change the style, just update it.

- Apple clearly doesn't care about desktop computers. If you go to an Apple store, there's that one iMac in the corner while the posters on the wall and the ads all tell you to buy something else.

RoelJuun · Jan 23, 2013

The new iMac is also ridiculously expensive. Last year models were pretty good price/performance for an AIO, the current need over-the-top expensive upgrades from Apple to make them great (Fusion/SSD). An iMac with SSD starts at 1635

iBug2 · Jan 23, 2013

mrsir2009 said:
I reckon the sales would have been higher if the rMBP hadn't been released - As people who are in the market for a new MacBook Pro would opt to wait for the second gen retina, due to a price slash and first-gen bugs being ironed out. Once they bring out a second gen retina with a lower price tag, and possibly make the cMBP's a tad cheaper as well, sales will go way up.

Their Laptop sales were fine. Their iMac sales were low.

Peace · Jan 23, 2013

1Alec1 said:
BS.

- The new iMac has non-removeable RAM, a deterrent for some users.
- It took Apple forever to update the iMac. Dell can push out an update every 2 seconds. All they have to do is make the internal components NOT over a year old.
- Apple clearly doesn't care about desktop computers. If you go to an Apple store, there's that one iMac in the corner while the posters on the wall all tell you to buy something else.

You did hear that MS was putting 2 billion into Dell to go private right ?

iBug2 · Jan 23, 2013

blackhand1001 said:
I am sorry but apple sells 10 times as many laptops as they do desktops. The imac is not the reason mac sales were down 22%.

They already said that the iMac sales were 700K less than last year. Yes that doesn't make the 1.1 million loss (assuming that the mac wouldn't shrink or grow), but still that's a lot. So what you mean is that the iMac isn't the only reason mac sales were down.

nuckinfutz · Jan 23, 2013

RoelJuun said:
The new iMac is also ridiculously expensive. Last year models were pretty good price/performance for an AIO, the current need over-the-top expensive upgrades from Apple to make them great (Fusion/SSD). An iMac with SSD starts at 1635

They are the same price in the US when you account for today's models all come with 8GB of RAM standard.

mrsir2009 · Jan 23, 2013

Brian Y said:
If that was the case - they wouldn't have seen such high demand at launch.

It's their top of the line product, it's going to be expensive - and you could say that about anything. If the 13" MBP was cheaper it'd sell more. But that's not what Apple do.

The price of the Retina MBP is going to come down significantly, though. I mean, look at the MacBook Air... Since it's been released the price has been slashed by $300, for the 13" model.

nuckinfutz · Jan 23, 2013

1Alec1 said:
BS.

- The new iMac has non-removeable RAM, a deterrent for some users. And the SD card slot is on the back, WTF.

- It took Apple ridiculously long to update the iMac. Dell can push out an update every 2 seconds. All they have to do is make the internal components NOT over a year old. No need to change the style, just update it.

- Apple clearly doesn't care about desktop computers. If you go to an Apple store, there's that one iMac in the corner while the posters on the wall and the ads all tell you to buy something else.

No one but geeks are ranting about non-removable RAM or the SD card slot. The biggest complaint or at least concern is the lack of a DVD drive.

neiltc13 · Jan 23, 2013

This doesn't make any sense. The new Mac Pro was released last quarter and it included a great new CPU and GPU upgrade. So many people switched because of the machine's great power and price.

1Alec1 · Jan 23, 2013

nuckinfutz said:
No one but geeks are ranting about non-removable RAM or the SD card slot. The biggest complaint or at least concern is the lack of a DVD drive.

Who uses DVDs? Anyone who uses a camera (except for Sony cameras) uses an SD card and probably wants to put the card in the computer. Anyone who knows what RAM is probably doesn't want to pay the Apple price for it.

nagromme · Jan 23, 2013

I'm glad there's a company like Apply betting big on risky new design and manufacturing technologies... sometimes getting burned (like these low iMac supplies) and sometimes succeeding in a big way (milled aluminum casings across the board).

It's easy to just make whatever has worked before. But without this kind of innovation and risk-taking, we'd lose out on a lot.

(PREDICTION: someone will forget that we're talking about display lamination, and ask how "innovative" I think it is to make a DVD player optional

I'll answer now: I think it's not innovative, merely a good move.)

cxny · Jan 23, 2013

Low Mac Sales; Really?

This is probably the biggest surprise of the numbers at least to me. What happened to the "Halo Effect"? It can't be explained by just the delay in production on iMac. All the recent news has been about iPhone sales but if Apple can no longer produce compelling computers then Cupertino, we have a problem.

Apple Blames Low Mac Sales on iMac Supply Constraints

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