Apple's 3rd Quarter 2006 Financial Results

[MacRumors]

http://www.macrumors.com/images/macrumorsthreadlogo.gif

Apple posted their 3rd Quarter 2006 financial results today.

Apple posted revenue of $4.37 billion and a net quarterly profit of $472 million or $.54 per diluted share. For reference, the year-ago quarter brought in $3.53 billion in revenue, net profit of $320 million or $.37 per diluted share.

Apple shipped 1,327,000 Macintosh computers and 8,111,000 iPods during this quarter which represents a 12% growth in Macs and 32% growth in iPods year-over-year.

- 75% of Macs sold during the quarter used Intel processors.
- 2nd highest quarterly sales and earnings in Apple's history
- International sales accounted for 39 percent of the quarter’s revenue.
- iPod continued to earn a US market share of over 75 percent
- Desktops: 529,000, down 14% from previous quarter
- Portables: 798,000, up 60% from previous quarter
- iPods: 8,526,000


Live streaming of the results conference call will be broadcast at 5pm EST.

Updates:

- Mac: 55% of revenue. Increased sales to 1.327 million.
-- Pleased with Intel transition. "Solidly" on track to update Xserve and PowerMac by end of this year.
-- Over 2900 Universal Applications.
-- Most "critical" applications will be converted by September
-- MacBook very well received
-- Happy with the Mac ad campaign, feel that it is contributing to Apple's momentum
- iPod
-- NPD: 75% of market share US (MP3)
-- Other music product revenue up 90% year over year
-- Strong sales of iTunes and iPod accesories
-- iTunes Music Store - 85% marketshare.
-- Enthusiastic about upcoming iTunes/iPod products in the pipeline
- Retail
-- 146 stores open during quarter.
-- 50% of buyers are new to Mac.
- Outlook:
-- "Very excited about and confident in the products in our pipeline."

Q&A

Q: How important is it to hit the holiday season. and how innovative can innovative be [w/ respect to iPods]?
A: We don't talk about unannounced products, but "very confident" in products in our pipeline.

Q: Markets: Consumer, Education, Pro
A: The MacBook was in high demand in both consumer and education. Pro market has been slow - thought to be due to wait in PowerMac with Intel and some Universal apps. Education market did very well. Higher edu grew 31% year to year. Very well poised in going into school season.

Q: Assuming any contribution from Leopard for the September [next] quarter?
A: We've not announced the ship date for Leopard, but will show the new features at WWDC.

Q: Does the fact that Intel rolls our processors more quickly and drops prices affect you? Will you be adjusting prices more frequently or same as you have been with new product releases?
A: We're very pleased to be working with Intel. A great partner. They have the best processor by far in our current and upcoming products. Pleased with the new products, but as you know we don't discuss our unannounced products. don't want to comment on how we'll be changing our pricing.

Q: Will there be any surprises at WWDC?
A: [Laughter, then Openheimer:] Well, you will have to come and attend.


Digg This

[esquared]

and the train kept 'a rollin', all night long.

[ShaunPriest]

This is excellent. iPod sales are slowing down however this is to be expected. Nice to see the Mac sales well above the million mark.

[macidiot]

What, the analysts weren't even close? I'm shocked.

[liketom]

i get the feelling i helped ... yet again with a few of them macs and pods

great results

[Cubert]

Boooo-Yahhhh!

Quoth Jim Cramer.

[p0intblank]

Impressive numbers! Intel Mac sales are actually higher than I thought they'd be. And of course, the iPod is the leader once again.

[mainstreetmark]

Count me in, too.

Of course, they got an extra $200 out of me, because I wanted a black Macbook. *grumble*

[plinden]

There are more details here - http://biz.yahoo.com/prnews/060719/sfw089.html?.v=60

At the end of the page is a breakdown in the sales figures.

Desktop sales are down 14% on last quarter, and 23% on a year ago, but laptop sales are up a whopping 60% on last quarter and 61% on a year ago.

[im_to_hyper]

Other than recently, how often have Mac sales been in the million+ a quarter? Didn't 2002 or something only see that many shipped the entire year?

[sfwalter]

Those analysts really need to do their homework. They brought Apple's stock down because of their negativity. Since they were wrong I think the analysts need to reimburse shareholders for lost money .

[longofest]

Originally Posted by macidiot

What, the analysts weren't even close? I'm shocked.

Actually, the analysts were pretty close this time, except for the profit margins. I'm thinking that the fact that the iPod is now using older parts (therefore cheaper parts) is pushing the cost down for Apple, and hence really making it a big cash cow and driving up the profit margin, even if they aren't selling quite as many as last quarter (which also has to do with seasonal decline).

Edit: oops... it appears as though the analysts definitely did blow the whole revenue expectation a bit. Missed that.

[ampd]

one of these days when I have enough money (hopefully by around Aug. 7th) I will be able to buy a mac and become part of those stats.

[Mulyahnto]

Analysts' expectation of $3.68B revenue is incorrect. Apple exceeded income expectations by 10c per share and was in line with revenue expectation of about $4.4B.

[andiwm2003]

Where are all you "Apple is doomed" sayers now?

Apples sells ~4 Million Macs per quater. That's ~16 Mio a year. Given a 4 Year Life time that's "only" ~64 Mio Mac's installed, maybe more. That should be enough to keep developers happy.

So ADOBE, release those f#$%ing universal binaries NOW!!!!

[plinden]

Originally Posted by im_to_hyper

Other than recently, how often have Mac sales been in the million+ a quarter? Didn't 2002 or something only see that many shipped the entire year?

No - according to http://www.pegasus3d.com/total_share.html Mac sales have been above 3 million since 1998. But it looks like Apple's on track for > 5 million in 2006, the highest sales figures ever.

Originally Posted by andiwm2003

Where are all you "Apple is doomed" sayers now?

Apples sells ~4 Million Macs per quater. That's ~16 Mio a year. Given a 4 Year Life time that's "only" ~64 Mio Mac's installed, maybe more. That should be enough to keep developers happy.

No, please re-read the figures - it's 1.327 million Macs for the last quarter.

[Peace]

Woo Hoo!! Keep it up guys!!

[Queso]

Nice to see the mothership sailing smoothly. What do you reckon for the Christmas quarter? Is 2 million Macs possible?

[Mulyahnto]

I think iPod and Mac sales volume was towards the high end of the range of analysts' predictions. iPod and Mac sales volume is a more important indicator than revenue, I think.

[longofest]

For those who do the digging thing: http://digg.com/apple/Apple_s_Q3_200...ompany_History!

[macidiot]

Originally Posted by longofest

Actually, the analysts were pretty close this time, except for the profit margins. I'm thinking that the fact that the iPod is now using older parts (therefore cheaper parts) is pushing the cost down for Apple, and hence really making it a big cash cow and driving up the profit margin, even if they aren't selling quite as many as last quarter (which also has to do with seasonal decline).

Edit: oops... it appears as though the analysts definitely did blow the whole revenue expectation a bit. Missed that.

Actually, they were completely off base with their Mac estimates. Since it appears that most people on Wall St. think that Apple only makes iPods, this is no surprise.

Most estimates were for around 1 million Macs sold. Apple came in at 1.3 million. There's the margin difference right there.

[lOUDsCREAMEr]

does it mean mac's desktop market share is climbing? 5%?

[Mulyahnto]

Originally Posted by plinden

No - according to http://www.pegasus3d.com/total_share.html Mac sales have been above 3 million since 1998. But it looks like Apple's on track for > 5 million in 2006, the highest sales figures ever.

Apple has been shipping at least 1 million Macs per quarter since Q1 2005. They shipped ~800K in Q4 2004.

[Mulyahnto]

Originally Posted by macidiot

Actually, they were completely off base with their Mac estimates. Since it appears that most people on Wall St. think that Apple only makes iPods, this is no surprise.

Most estimates were for around 1 million Macs sold. Apple came in at 1.3 million. There's the margin difference right there.

This is what page 1 reported a couple days ago:

They predict Apple sales results that are close to but slightly lower than the Wall Street consensus estimates, with iPod quarterly sales between 7.7 and 8.3 million units, Mac sales of 1.2 to 1.23 million units, and revenue of $4.6 billion and $0.48 earnings per share, compared to Wall Street estimates for revenue of $4.95 billion and $0.52 earnings per share.

[jholzner]

Originally Posted by andiwm2003

Where are all you "Apple is doomed" sayers now?

Apples sells ~4 Million Macs per quater. That's ~16 Mio a year. Given a 4 Year Life time that's "only" ~64 Mio Mac's installed, maybe more. That should be enough to keep developers happy.

So ADOBE, release those f#$%ing universal binaries NOW!!!!

Huh? Apple doesn't come close to selling 4 million Macs per quarter! They sold just above 1.3 million this quarter.