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Old May 9, 2013, 06:47 PM   #1
Assault
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Lightbulb The old "Shipped vs Sold" argument - Apple admits....

A very good article was just posted that confirms that Apple reports "shipped" numbers, just like Samsung and the rest of the Android manufacturer's. But to be fair to Apple, their shipped numbers more closely match likely sold numbers than say HTC, Samsung or Sony. The only "sold" numbers that can be counted are those Apple sells in one of its 400 stores or online, but those numbers are only about 10-20% of the "shipped" numbers they give out at their quarterly report.

Link to article: http://gigaom.com/2013/05/09/what-ap...old-a-product/

from the article ;

Quote:
The Company (Apple) recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collection is probable. Product is considered delivered to the customer once it has been shipped and title and risk of loss have been transferred. For most of the Company’s product sales, these criteria are met at the time the product is shipped. For online sales to individuals, for some sales to education customers in the U.S., and for certain other sales, the Company defers revenue until the customer receives the product because the Company retains a portion of the risk of loss on these sales during transit.

It seems like a small thing, but it is important to keep in mind when evaluating the mobile market, especially as it matures and multiple sales channels are employed. In order to present the clearest possible picture of how demand for Apple’s products stands in relation to its competitors, we will be referring to Apple’s announced numbers as “shipped” from now on.
Edit: For those Apple fans that want to completely deny this and stick their head in the sand, I suggest you read Apples latest 10-k filing, specifically end of page 26.

Link to make it easy for you and screen shots to make it even easier for you;
http://investor.apple.com/financials.cfm

Last edited by Assault; Jul 1, 2013 at 07:01 PM.
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Old May 9, 2013, 08:17 PM   #2
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The most important part of the article:

Apple’s “sold” numbers are really its shipment numbers, according to several prominent financial analysts who obsessively follow every word and number that emerges from Cupertino. Horace Dediu, who writes the Asymco blog, told me that “Apple’s reports show shipments not sales.” He added, “All vendors as far as I know report shipment data since that is what they can record.”
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Old May 9, 2013, 08:46 PM   #3
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Originally Posted by YourAvgUser View Post
The most important part of the article:

Apple’s “sold” numbers are really its shipment numbers, according to several prominent financial analysts.....
I would never believe it after reading so many threads here of anal apple purchasers who think nothing of returning multiple "shipped" items in their search for that one perfect "sold" product.
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Old May 9, 2013, 08:56 PM   #4
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I would never believe it after reading so many threads here of anal apple purchasers who think nothing of returning multiple "shipped" items in their search for that one perfect "sold" product.
I came from an iPhone 4 to an HTC One today and I, and many others, are or have been doing the same with the One. It really is the nature of the construction of the phone. Anodized aluminium, chamfered edges etc. I suppose we did buy into the Tim Cook spiel of an "absolute jewel" of a phone and this has been transposed to the One. I, sadly, have been examining the phone to an unhealthy degree from all angles and light levels.

I do feel that if I had picked up an S4, as long as there was nothing egregious about the build of the device, I would not have been so obsessive. In some ways that would have been better.
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Old May 9, 2013, 09:03 PM   #5
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Originally Posted by Peterg2 View Post
?.....It really is the nature of the construction of the phone. Anodized aluminium, chamfered edges etc.......I, sadly, have been examining the phone to an unhealthy degree from all angles and light levels......
..... Or it really is the nature of the purchaser's expectations of product perfection .........
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Old May 9, 2013, 09:05 PM   #6
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Originally Posted by Assault View Post
A very good article was just posted that confirms that Apple reports "shipped" numbers, just like Samsung and the rest of the Android manufacturer's. But to be fair to Apple, their shipped numbers more closely match likely sold numbers than say HTC, Samsung or Sony. The only "sold" numbers that can be counted are those Apple sells in one of its 400 stores or online, but those numbers are only about 10-20% of the "shipped" numbers they give out at their quarterly report.

Link to article: http://gigaom.com/2013/05/09/what-ap...old-a-product/

Excerpt from the article ;

"It seems like a small thing, but it is important to keep in mind when evaluating the mobile market, especially as it matures and multiple sales channels are employed. In order to present the clearest possible picture of how demand for Apple’s products stands in relation to its competitors, we will be referring to Apple’s announced numbers as “shipped” from now on."
I don't know how you came to the conclusion that "Apple" admitted or that this article "confirms" anything you claim. In fact what it states is what analysts interpret.

Last edited by SandboxGeneral; May 9, 2013 at 09:45 PM. Reason: Clean up
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Old May 9, 2013, 09:08 PM   #7
Peterg2
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Originally Posted by TPadden View Post
..... Or it really is the nature of the purchaser's expectations of product perfection .........
It really is unrealistic expectations, partly created by manufacturers. Cell phones are not finely crafted Vacheron et Constantin or Patek Philippe watches. They are simply *mass* produced items made in huge factories in China and the like, clad sometimes with "fancy" finishes which give the aura of high quality. But, overall, they are made to a price point and with that in mind QC has to definitely suffer.
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Old May 9, 2013, 09:40 PM   #8
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Originally Posted by jamojamo View Post
I don't know how you came to the conclusion that "Apple" admitted or that this article "confirms" anything you claim. In fact what it states is what analysts interpret.

Just another trolling attempt in my view based on the thread title.
From the article and via Apple's own website. Quote;

Quote:
The Company (Apple) recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collection is probable. Product is considered delivered to the customer once it has been shipped and title and risk of loss have been transferred. For most of the Company’s product sales, these criteria are met at the time the product is shipped. For online sales to individuals, for some sales to education customers in the U.S., and for certain other sales, the Company defers revenue until the customer receives the product because the Company retains a portion of the risk of loss on these sales during transit.
tweet this


----------

Quote:
Originally Posted by YourAvgUser View Post
The most important part of the article:

Apple’s “sold” numbers are really its shipment numbers, according to several prominent financial analysts who obsessively follow every word and number that emerges from Cupertino. Horace Dediu, who writes the Asymco blog, told me that “Apple’s reports show shipments not sales.” He added, “All vendors as far as I know report shipment data since that is what they can record.”
Actually, the most important part, I just quoted. Look up ↑↑
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Old May 9, 2013, 09:43 PM   #9
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Originally Posted by Assault View Post

Actually, the most important part, I just quoted. Look up ↑↑
You seem to forget that Apple is a direct sales channel. So those 'shipped' items could be shipments to the end user. So that statement is basically saying 'if FedEx screws up your stuff its on them, not us, to make it right'

In constrast to someone like Samsung who doesn't do direct sales.

Also in re: to the article, analysts have no knowledge of anything inside any company, they are talking out their butts.
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Old May 9, 2013, 10:23 PM   #10
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Originally Posted by charlituna View Post
You seem to forget that Apple is a direct sales channel. So those 'shipped' items could be shipments to the end user. So that statement is basically saying 'if FedEx screws up your stuff its on them, not us, to make it right'

In constrast to someone like Samsung who doesn't do direct sales.

Also in re: to the article, analysts have no knowledge of anything inside any company, they are talking out their butts.
Please read the article. Apple's "direct" sales only make up 10-20% of "all" sales. Also, Apple annual 10-k specifically states what I bold and highlighted. It is shipment numbers.
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Old May 10, 2013, 02:05 AM   #11
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Originally Posted by Assault View Post
Please read the article. Apple's "direct" sales only make up 10-20% of "all" sales. Also, Apple annual 10-k specifically states what I bold and highlighted. It is shipment numbers.
I thought this was always implied. What would be the point of any company tracking (for financial purposes) where their products go after they reach retailers? Where did it say 10-20% of all sales? I would assume that it is much higher (therefore more accurate than other companies when regards to sold) because we aren't just talking about the physical Apple Store, we're also considering Apple's Online Store.
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Old May 10, 2013, 06:28 AM   #12
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We've been over this many times before. Apple reports shipments to retailers as a sale, along with direct sales from its own online or brick stores.

This is what Apple counts as sales in their quarterly reports:
  • Apple DOES count sales to retailers at the time of shipping.
  • Apple DOES count online sales after they arrive to the customer.
  • Apple DOES count end user sales from their physical stores.

And what is not included:
  • Apple does NOT report shipments to their own stores as sales.
  • Apple does NOT include sales to online customers until they arrive. (Which is why presale numbers can be larger than reported sales for a little while if shipments are behind.)

Of minor interest: whereas Apple records a sale to a carrier or other retailer the moment the device ships, Samsung counts the sale after the device arrives.
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Old May 10, 2013, 07:22 AM   #13
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Originally Posted by kdarling View Post
We've been over this many times before. Apple reports shipments to retailers as a sale, along with direct sales from its own online or brick stores.

This is what Apple counts as sales in their quarterly reports:
  • Apple DOES count sales to retailers at the time of shipping.
It's also important to note that those are actually sales in a sense because the retailers can't return them to Apple if they don't sell the way that say a bookstore can return hardcovers or stripped paperbacks and get credit for them.

That is a huge issue with carriers because they don't always want to commit to buying X thousand phones and then be stuck with them

----------

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Originally Posted by Assault View Post
Please read the article. Apple's "direct" sales only make up 10-20% of "all" sales.
I don't see a screenshot from any 10-k that says that. So who AT APPLE is quoted as the source of this figure. Or is that another those allegedly knowledged analysts guesstimating a 'fact' with no real knowledge.
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Old May 10, 2013, 08:09 AM   #14
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Originally Posted by charlituna View Post
It's also important to note that those are actually sales in a sense because the retailers can't return them to Apple if they don't sell the way that say a bookstore can return hardcovers or stripped paperbacks and get credit for them.

That is a huge issue with carriers because they don't always want to commit to buying X thousand phones and then be stuck with them

----------



I don't see a screenshot from any 10-k that says that. So who AT APPLE is quoted as the source of this figure. Or is that another those allegedly knowledged analysts guesstimating a 'fact' with no real knowledge.
I agree with both positions to some degree. I think they do report them a little different. That does not mean the Samsung shipped number are not sales. They argue this point to death on AppleInsider as well. But then even on AI the site itself posts articles about how well Samsung is doing and how much their net profit has soared. If those numbers that AI is reporting on are true. You can logically conclude that Samsung's numbers are accurate. If they shipped product that did not sell....then retailers would correct the orders the next time around. Then the next quarter or reporting period there would be a correction and number would slow down. But that is not happening.
http://appleinsider.com/articles/13/...85b-minus-debt
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Old May 10, 2013, 09:03 AM   #15
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then retailers would correct the orders the next time around.
No they don't, and Samsung sure doesn't. No company adjusts for returns where cars, computers or even copies of the latest teen lit
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Old May 10, 2013, 09:13 AM   #16
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then retailers would correct the orders the next time around.
No they don't, and Samsung sure doesn't. No company adjusts for returns whether cars, computers or even copies of the latest teen lit

Last edited by charlituna; May 10, 2013 at 09:21 AM.
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Old May 10, 2013, 10:04 AM   #17
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It's also important to note that those are actually sales in a sense because the retailers can't return them to Apple if they don't sell the way that say a bookstore can return hardcovers or stripped paperbacks and get credit for them.
IIRC, both Apple and Samsung's 10-Ks state that they account for returns separately from sales revenue.

As for jamezr's comment about adjustment, I assume they meant that if a store buys more than they can sell, then their next order will be correspondingly lower. (This happens at times with retailers for every company, including Samsung and Apple.)
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Old May 10, 2013, 10:29 AM   #18
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Originally Posted by charlituna View Post
Quote:
Originally Posted by Assault
Please read the article. Apple's "direct" sales only make up 10-20% of "all" sales.
I don't see a screenshot from any 10-k that says that. So who AT APPLE is quoted as the source of this figure. Or is that another those allegedly knowledged analysts guesstimating a 'fact' with no real knowledge.
My friend, if you only want to deal with exact numbers, you won't be posting much

A lot of counts are guesstimates, simply because companies don't reveal everything.

Apple, for example, does not break out individual model sales. They don't even tell us how many sales are refurbs... which must number in the millions. Not to mention all the carriers not telling us how many activations are for new sales, and how many are for used devices, which can be a pretty significant number.

So we have to rely on surveys and exit polls, etc. At least their research is far better based than someone's random guess.
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Old May 10, 2013, 10:51 AM   #19
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No they don't, and Samsung sure doesn't. No company adjusts for returns whether cars, computers or even copies of the latest teen lit
Yes...they would. If Bestbuy ordered 500K phones from Samsung for Q2 then only sold 400K. All logic says the BB would then lower the order for the next time....
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Old May 10, 2013, 02:41 PM   #20
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My friend, if you only want to deal with exact numbers, you won't be posting much

A lot of counts are guesstimates, simply because companies don't reveal everything.
The point is if you are going to state something as fact it needs to be a fact. Not some 'allegedly based on some specious calculations by some analyst who got his numbers from a source supposedly in the know at only one of who knows how many suppliers for a single component' nonsense. Which tends to be the quality of the 'facts' around here.
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Old May 10, 2013, 06:47 PM   #21
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Charlituna;17254294]The point is if you are going to state something as fact it needs to be a fact. Not some 'allegedly based on some specious calculations by some analyst who got his numbers from a source supposedly in the know at only one of who knows how many suppliers for a single component' nonsense. Which tends to be the quality of the 'facts' around here.
Not sure how much more factual you want than Apple themselves stating they announce "shipped" numbers in their quarterly reports and announcements in their 10-k annual filing. I even posted links and screenshots for anyone to look up. Apple is no different than Samsung, Sony, HTC, Blackberry, etc.

If you want to ignore those facts, then you really have been stuck inside the reality distortion field Jobs created.
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Old May 10, 2013, 09:10 PM   #22
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The point is if you are going to state something as fact it needs to be a fact. Not some 'allegedly based on some specious calculations by some analyst who got his numbers from a source supposedly in the know at only one of who knows how many suppliers for a single component' nonsense. Which tends to be the quality of the 'facts' around here.
Kdarling is one of the most accurate and objective posters on this site. You do yourself no good service by trying to refute what he has asserted here with strawman arguments.

Is it going to have any kind of personal effect on you if Apple reports shipped product as sales? Will it somehow lower the number of iPhones and iPads in existence? Nope.




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Old May 10, 2013, 09:49 PM   #23
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YAWN...

Who cares! Nothing new to report here. Only the crazy Apple fanatics chose to see things differently.
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Old May 11, 2013, 11:43 AM   #24
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It's also important to note that those are actually sales in a sense because the retailers can't return them to Apple if they don't sell the way that say a bookstore can return hardcovers or stripped paperbacks and get credit for them.
They are ALL sales to the retailers.

Remember the massive failure of the HP WebOS TouchPad launch where Best Buy went kicking and screaming and demanded HP to take back the unsold TouchPads.

If it wasn't a "sale", then Best Buy won't have to go to HP kicking and screaming --- Best Buy would have just calmly tell HP to take back the unsold TouchPads.

The fact that Best Buy kicked up a big fuss and leaked it to newspaper reporters --- meant that it was a "sale" and HP didn't have to take it back.
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Old May 14, 2013, 08:31 PM   #25
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Finally. Put this thing to bed. It baffles my mind that people actually think Apple is the sole company that reports sales differently than everyone else on the planet. Take "think different" literally much?
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