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Apple Q3 Conference Call Results

G5 processor speed

So it may be reasonable to infer that the processor speed choices for the iMac will be 1.8 and 2.0 since these are the chips that he specified that IBM was having problems with. And the 2.5 will most likely be needed to fill PM orders since they are experiencing delays through the quarter.
 
carletonmusic said:
Hopefully the announcement of the G5 iMac will boost Apple's stock back up a little. :rolleyes:
Click to expand...

Well, it's up over 5% in after hours trading so far. :)
 
Great--these iMacs will sell by the truckload no matter WHAT they look like. (AI implies that the iMac will stay all-in-one. As it should... but a headless option would be good too!)

Temporary delays or no, IBM and the Power platform are great for the future.

How did Apple do compared to the profits analysts predicted?
 
eric_n_dfw said:
The statement that they're having delays shipping the PowerMac's will proabaly bring it down some though.
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The whole conference call sounds very positive I wouldn't expect it to slip much if any (obviously it depends on traders prior expectations). It seems demand is way out stripping supply in many areas, I wish I had bought Apple stock when I was thinking about it :(
 
analysts predictions

nagromme said:
Great--these iMacs will sell by the truckload no matter WHAT they look like. (AI implies that the iMac will stay all-in-one. As it should... but a headless option would be good too!)

Temporary delays or no, IBM and the Power platform are great for the future.

How did Apple do compared to the profits analysts predicted?
Click to expand...

The company's latest results beat the average of Wall Street analysts' estimates by 2 cents a share. On average, they had expected Apple would report earnings for the latest period of 15 cents a share on sales of $1.94 billion, according to a Thomson First Call survey.
 
eric_n_dfw said:
The statement that they're having delays shipping the PowerMac's will proabaly bring it down some though.
Click to expand...
They are not delaying the start of shipments of any Power Macs!

They outlined constrained supplies for all PowerMac G5 systems for the remainder of this month and for the 2.5GHz systems for the rest of the next fiscal quarter. Constrained supply will delay some shipments but they will be shipping product including PowerMac 2.5GHz systems. They expect the G5 supply issues to be solved by IBM near the beginning of FQ1 2005 (which starts in Sept. 2004).
 
Conference Call Summary

ive Conference Call Notes (most recent first):

- End of Conference Call.
- Over 13,000 retail outlets for iPod. More people want to sell it than Apple has supply to provide.
- As Euro iTunes Music Store launched, Euro iPod sales increased as well.
- Best Buy and Apple work well with iPod sales. No plans to increase working together on CPU sales.
- IBM offering G5 price concessions to Apple due to delays? Apple has no comment.
- iPod Halo Effect? CPU shipments up 14%. 50% of computers Apple selling in retail stores new to Mac or coming back to Mac form "other" platforms.
- Q4 2004 share count "about 400 million."
- Apple will try to do what is necessary to match iPod mini supply with demand. iPod mini supply constrained by 1" drive component.
- Xserve G5s sold 13K units - a quarterly record for Apple.
- Why doesn't Apple repurchase shares? Why does Apple allow "share creep" which dilutes share price for existing shareholders? Apple opted to maintain cash for flexibility and possible acquisitions.
- Airport Express did not ship in Q3, not in Q3 results. Apple's taken over 80K global orders so far.
- Air freight expenses for Q4 2004 primarily relate to new iMac G5.
- Apple not happy with Japan performance. Key market, Apple working to improve.
- Apple Japan: revenue increased 8% when including Japan Retail Store.
- iMac G5 processor "most critical factor" in delay.
- Office Depot authorized to sell online. No plan to extend to retail stores.
- hPod: HP will ship "this summer."
- Apple very please with portable line.
- Given the international iPod mini orders, supply will not match demand in Q4 2004.
- iTunes Music Store generated a small profit.
- Decline in peripherals attributed to transition in display line.
- Demand for iPod mini is "staggering." International orders "unprecedented." Hard to predict when demand will match supply.
- Apple anticipates iPod unit growth sequentially.
- iMac G5 heating issue not a critical factor. Wafer supply is cause of delay.
- Apple has reviewed IBM plans. Numbers look sound.
- IBM told Apple they have placed enormous resources behind fixing issues.
- IBM G5 wafer issues: will iron out by Q1 2005.
- International iPod mini orders started about a week ago. Order numbers are "unprecedented."
- iPod mini demand far exceeds supply.
- No recall or quality issues with iPod lines.
- Education space shows several quarters of growth in higher ed.
- CPU sales strength came from Pro lines. PowerBook up 37% year over year.
- 2004 total revenue should exceed US$8 billion.
- IBM G5 supply issues taken into account for Q4 forecast.
- Forecast for Q4: revenue of $2.1 billion, .16-.17 cents per share.
- Next gen iMac G5 coming in September.
- Cash up to $4.96 billion. Apple is a debt-free company.
- Japan up 2% year over year.
- US up 23% year over year.
- Euro revenue up 47% year over year.
- 16% educational revenue growth year over year.
- Osaka, Japan, London stores coming this year.
- Apple Retail Stores now total 80 with $270 million revenue
- iTunes Music Store holds over 70% share of legal downloads with over 100 million songs sold.
- 860K iPods (incl. iPod mini) units sold.
- Apple is extremely unhappy. IBM has told Apple Q1 2005 will mark end of CPU issues.
- Next gen. iMac G5 impacted by IBM shortages.
- PowerMac G5 shortages expected due to IBM CPU difficulties in Q4.
- iBook 240K, iMac 220K, 416K desktops
- Highest quarterly unit shipment of Macs
- P.O. - we're very pleased. Highest Q3 in eight years.
- Apple CEO Peter Oppenheimer (P.O.) introduced.
- Awaiting start of call.
 
xsnightclub said:
So it may be reasonable to infer that the processor speed choices for the iMac will be 1.8 and 2.0 since these are the chips that he specified that IBM was having problems with. And the 2.5 will most likely be needed to fill PM orders since they are experiencing delays through the quarter.
Click to expand...

I'd concur it seems there would be chips available for the iMac if it was speced below 1.8. It also sounds as if they are starting to stockpile already for the iMac hence 1.8 (and 2.0?) PM delays.
 
90 nm

So basically, everyone who had their order in very quickly, like in the first week, could have it relatively quickly, say beginning of august max, and the rest would have to wait as more supply of the comes available.

They also said the 1.8 and 2.0 processors are facing supply issues, and these are currently used in the rev B powermacs, and perhaps in the new iMac revision. So this should clarify the fact that the whole powermac lineup now uses 970fx processors @ 90nm, and no more processors are being made on the 130 nm technique, as there were no supply issues with those.


Let's hope I'm in the first batch of 2.5 shipments to europe, ordered on the 13th, 4 days after introduction.
 
lloyd said:
Is there a new design to deal with the heat issues?
Click to expand...

I was very disappointed by the analysts' reluctance to ask followup questions, and by their willingness to have their questions ignored.

Twice analysts asked if there were problems IN ADDITION TO the chip shortage from IBM; one or both asked if there were also related heat probs with the design. In each instance the response was that the chip shortage was "the primary" problem. In journalism we call that a "non-answer answer," and it was very disappointing. They asked the right question, they just settled for being ignored. Right by half.

peace
terry
 
xsnightclub said:
- iBook 240K, iMac 220K, 416K desktops
Click to expand...
And they actually broke down the "iMac" category this time, it was something like 180k eMacs and 60k FP iMacs. That's why cancelling the iMac didn't concern them very much.
 
Hmm - new iPods coming, hPod coming this summer.

These may have nothing to do with each other. But I saw a website that said Apple has confirmed rumors of an iPod update. The iPod will be smaller than the current iPod mini but will have drives up to 60GB and will replace the full size iPods not the minis.

Also see that hPods are coming out this summer. Is it possible that the hPods will be the current "big" iPods when Apple moves to the smaller ones?
 
3.1416 said:
And they actually broke down the "iMac" category this time, it was something like 180k eMacs and 60k FP iMacs. That's why cancelling the iMac didn't concern them very much.
Click to expand...

That's a bombshell. Only 60K FP iMacs, heck they even sold 13K Xserves.
 
bluefido said:
That is a lot of profit, but profit can goes toward a lot of things...i.e. more R&D, dividends, but probably not a cheaper iMac. People pay premium prices for Apple products. Why lower them?
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That is NOT a lot of profit!

It's a lot of money, but it's a terrible profit margin. Less than 4%.

Successful companies shoot for 15% profit margins. In this case that would yield about $300 million in profits on sales of $2 billion.

Microsoft has had profits of over 60%, on sales far higher, though it's been a while.

Additionally, Apple makes a LOT of revenue on its cash supply. At 3%, they'd make nearly $40 million per quarter on interest! That means they may have generated 'just' $27 million of profit on operations. With revenue of $2 billion, that sucks frankly!

I think this is good news for Apple. Growing profits are great, growing units are great. Apple has financial wizards running the company, and I have great faith in them. What they have done in the last 5 years given the hand they were dealt is nothing short of spectacular.

In discussing how low the profit margins are, I'm not bashing Apple, just showing people that they're not (yet) raking in excessive profits (i.e. this is no time to be suggesting a lowering of prices due to excessive profits, other reasons might be fair game).

I firmly believe they're headed in the right direction, are making the right decisions, are well managed, etc. With significant growth in units, the profit numbers will certainly be improved dramatically. :)
 
Funny how people think because a company is making money that they
should reduce prices. Apple makes money as long as their margins stay where they are and even go up. They depend on vendors supplying them with components at prices they contract for. Sometimes prices fall, sometimes they rise. We know that Apple does reduce prices after a product is out for a while - a common business practice in any industry. First you gotta pay for the R&D, manufacturing, distributing, advertising, promotion, salaries, outside vendors, etc. The price of a product is not just the price of its parts. Apple cannot compete with Dell or HP on prices. They cannot sell enough CPUs to drop to that level - ever. M$ is too entrenched. The war was over a long time ago and M$ won. Accept that. Now, small battles can go Apple's way.
 
Microsoft had over 60% profit...

Apple is a HARDWARE company.
M$ is a SOFTWARE company.
There are a LOT more costs involved in hardware than software.

Everything else I agree with ... mostly.
 
Wait a second... this says "Office Depot authorized to sell online. No plan to extend to retail stores". But in an email described here they say:

"Thank you for contacting Office Depot, in response to your inquiry, we
have just acquired Apple as an authorized dealer, so you should be
seeing the Apple products in our retail stores as well in the coming
months. If you have any questions or concerns, please feel free to
contact. Thank you for contacting Office Depot, have a great day!"

I'm confused, which is it?

:confused:
 
Sabon said:
Apple is a HARDWARE company.
M$ is a SOFTWARE company.
There are a LOT more costs involved in hardware than software.

Everything else I agree with ... mostly.
Click to expand...

Didn't Bill Gates once state that M$ makes more money off each Mac sold than Apple :mad:

That is truly a shame if it is true
 
Sabon said:
Apple is a HARDWARE company.
M$ is a SOFTWARE company.
There are a LOT more costs involved in hardware than software.

Everything else I agree with ... mostly.
Click to expand...

I didn't mean to imply that Apple would or should ever reach that point.

I should have used another example. I was just trying to make it clear
that Apple's current profits weren't anywhere near excessive with
respect to other businesses.

Excellent clarification. Thanks!

P.S. Tell me what you *don't* agree with. I'd like to know!
 
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