Apple Q1 07 Conference Call Live Coverage
Macworld's live coverage of Apple's call with financial analysts has concluded.
In his preamble before accepting questions from financial analysts, Apple CFO Peter Oppenheimer recapped Apple's earning announcement: The company posted $7.12 billion in revenue, a new record, and record net quarterly profit of $1.0 billion, or $1.14 per diluted share -- well above what Wall Street had predicted.
Apple shipped 1.606 million Macintosh computers during the quarter, along with 21.066 million iPods, representing 28 percent Mac growth and 50 percent iPod growth year-over-year. Oppenheimer said that was well above Apple's expectations.
Apple's mix of machines continues to emphasize portables over desktop models: The company shipped 969,000 MacBooks and MacBook Pros during the quarter, compared to 637,000 desktop machines. Portable Macs shipments grew more than 60 percent year over year, said Oppenheimer.
iTunes Gift Card sales doubled year over year. And sales through the Apple stores totalled $1.1 billion. Almost 28 million visitors came through the stores during the quarter, according to Oppenheimer. "We think they'll be a wonderful place to see the iPhone in June," he added.
Apple ended the quarter with just shy of $12 billion in cash, according to Oppenheimer.
Oppenheimer said that Apple is "voluntarily and proactively" cooperating with federal investigators as they explore possible issues related to the recent stock price backdating issues.
Price reductions on iPods and better distribution and supply to other retailers negatively affected Apple Store totals for iPod revenue, but Oppenheimer said that Apple was still very pleased with the results.
Apple VP Tim Cook said that Apple grew Mac and iPod sales dramatically in Canada and internationally, partly thanks to a more concerted effort to advertise in foreign markets.
Cook added that Apple continues to plan to ship Mac OS X v10.5 "Leopard" in the Spring. He also didn't think that anticipation for Leopard would cause any pause in Mac sales.
Cook said that Apple is selectively expanding the Mac channel with about 7,500 storefronts around the world (comparatively, iPods are sold at about 40,000 retailers worldwide). The company will work with Best Buy this quarter to figure out what its next step should be from a "pilot program" in place at about 50 stores.
Cook explained that around 50 percent of new Mac buyers coming to Apple Stores have previously owned PCs, but Steve Jobs' statement at Macworld Expo last week reflects that expansion of that into the rest of the channel too -- more evidence of the "halo effect" at work, he said -- the idea that iPod sales are driving new Mac users to the platform as well.
Apple hopes to see more pro-class Mac users migrate to new hardware once Adobe begins shipping the final version of its new Creative Suite 3 software, expected during the next calendar quarter.
Cook said that Apple is up to 1.5 million downloads of Boot Camp, the software that enables Intel-based Macs to install and use Windows at native speeds.