(1:36) Jason: Hi everyone.
(1:36) Jason Snell: First numbers are out.
(1:36) Jason Snell: $4.64 earning per share, $23.3 billion in revenue.
[Guest: how do those number meet consensus expectations?]
(1:40) Jason Snell: The expected estimate was $4.06, $18.86B.
[perfface4radio: any breakdown yet - mobile/desktop, iOS vs MacOS X, hardware vs software/services/iTunes?]
(1:41) Jason Snell: Yes. I am digesting it now but if you'd like to look, http://www.apple.com/pr/library/2010/10/18results.html
(1:41) Jason Snell: 36.4% gross margin, 4.19M iPads sold, iPhone 14.1M units, Macs 3.89M Mac units.
[jscarlton: iPhones doubled since last year...jeeze]
(1:43) Jason Snell: Yes, folks, that's a record number of Macs sold... again.
(1:44) Jason Snell: And the iPhone number is massive. That's a record by more than 5 million.
[brendon: Only 4.19 mill iPads, looks like the iPad is doomed (just ask AMD)]
[leicaman: iPods down. Apple's is beleaguered!]
[jscarlton: Data summary is the best place to look for breakdowns: http://images.apple.com/pr/pdf/q410data_sum.pdf]
[pberry: Looks like "unaffiliated" analysts were closer to the mark. Again. http://tech.fortune.cnn.com/2010/10/16/apple-analysts-frenzied-q4-round-up/]
(1:45) Jason Snell: Laptops make up 68% of the Mac mix, which is generally what it's been lately.
(1:46) Jason Snell: That's a record number of desktops and laptops, too, individually.
[Guest1: Brendon: Well, keep in mind that 57% of all sales were international - wait till they release the iPad in Europe.]
[brendon: what was the percentage increase in mac sales vs this quarter last year?]
(1:49) Jason Snell: Mac unit sales up 27.3% year over year
[Jon Baines: What are the overall figures for the iPad? Anyone know?]
(1:50) Jason Snell: iPad: 4.188M units, 2.792B revenue
[alexbrooks: iPad sales seem a little sluggish; due to Apple's slow roll out to third parties and new countries or a manufacturing ramp up problem? Or both?]
(1:52) Jason Snell: Good question that will probably be asked in the phone call.
[drsbmac: Any idea why the significant decrease in iPad sales (3 million last Q means only about 1.5 million this Q)?]
(1:54) Jason Snell: No, that's 4.188M this quarter, 3.270M last quarter, 7.4 total
[kalperin: from the "geeks don't understand the market" file: after hours quotes on google finance shows AAPL down over 18 points (almost 6%).]
[John: What's the cash balance? That's my favorite financial statistic.]
[Andreas: Apple stock declining 5% in after hours trading.]
[Guest: And calling 1.4 Million $500-$829 devices sold each month "sluggish" might be an overstatement ;)]
[Brendon: One of the most interesting things to me, the iPad is already out selling the Mac.]
(1:55) Jason Snell: Not in revenue, Brendon, just in units.
(1:55) Jason Snell: Keep in mind how much cheaper the iPad is.
(1:55) MacJournals.com: The iPad is also cheaper than most Macs and more portable than all of them.
(1:55) Jason Snell: Average Mac selling price is $1300.
(1:55) MacJournals.com: Cash balance won't come out until the conference call starts.
(1:55) Jason Snell: Average iPad selling price is $667
(1:56) MacJournals.com: Also, hello everyone; glad we could be here and a special shout out to MDJ and MWJ readers.
[Charlie: Is the web cast link working for others? I'm getting an error message.]
(1:57) Jason Snell: I'm seeing it too, Charlie
[Guest: Apple's 1st qtr forecast is lower then many thought - stock will lose recent gains]
(1:57) MacJournals.com: Jason, given the imprecision of Apple's figures, I hate to put three significant figures on that ASP, and maybe even two. I'd say between $650 and $700.
[Guest: Jason, do you have ASPs for iPad and Mac from last quarter?]
(1:58) Jason Snell: Sure, iPad ASP last quarter was $662 and Mac was $1270 or so
[Guest: 14M vs 4M iPhone vs iPad interesting given that the most bullish analysts expected more like 12M/5M.]
(1:58) MacJournals.com: ASPs from last calendar quarter for Mac was around $1250 and for iPad almost exactly the same as this quarter.
[johnrust: Live stream is working now]
(1:59) MacJournals.com: Also, keep in mind that the stock may be falling because the FIRST words out of CNBC's report was how "disappointing" the iPod sales were. Every trader in the country who trades at this time has that channel on the teevee.
(1:59) Jason Snell: I'm not seeing the live stream
[sfmitch: Live stream still not working for me.]
[alexbrooks: Webcast not working from London, UK.]
[Tim: Is there a place I can listen in on the conference call? a website?]
(2:00) MacJournals.com: The call hasn't started yet, so that may be part of the issue.
(2:02) MacJournals.com: CNBC now saying that iPods and iPads "missed" expectations, leaving out that Apple did not give guidance for product lines—this is only the analyst's guesses that are wrong.
[bobrk: still broken here. the link is at http://www.apple.com/quicktime/qtv/earningsq410/ but clicking the listen button gives a broken URL.]
(2:02) Jason Snell: http://stream.qtv.apple.com/events/oct/earnings/earnings_10/earnings_ref.mov
(2:02) Dan Moren: The livestream was having some issue, folks.
(2:03) Dan Moren: But it seems like we've got a URL, as Jason just posted.
[Tim: Stupid CNBC, of course typical mac hater... emphasizes the only piece of bad news]
(2:03) Dan Moren: Here are the opening remarks.
(2:03) MacJournals.com: Wall Street analysis is the only profession where you get to guess what other people will do, get it wrong, and then manage to blame the other people for not fulfilling your expectations.
(2:03) Dan Moren: As always, some of this information are forward-looking statements.
[Andreas: What's the name of the tune playing (in the webcast)?]
(2:03) Jason Snell: My classical knowledge is zero.
(2:04) Jason Snell: Okay, here we go!
(2:04) Dan Moren: Annnnd here's Peter Oppenheimer.
(2:04) Dan Moren: Extremely pleased to report the conclusion of a great fiscal year for Apple.
(2:04) Dan Moren: New all-time records for Mac, iPhone, and iPad sales in September quarter and highest quarterly revenue in Apple's history.
(2:05) Dan Moren: Very strong growth fueled primarily by record iPhone sales, iPad popularity, and best Mac quarter ever.
(2:05) Dan Moren: Net income was 4.31 billion, exceeding previous quarterly earning records by $930 million and 70% growth year-over-year.
(2:05) Dan Moren: Mac products and services first.
(2:05) Dan Moren: 3.9 million Macs, beating previous record by over 400,000
(2:05) Dan Moren: 27 percent year over year growth.
(2:05) Dan Moren: More than double IDC's poejcted growth for PC market overall.
(2:06) Dan Moren: Very strong sales of iMac, updated in July.
(2:06) Dan Moren: Mac growth strong in each segment, led by Asia/Pacific andJapan.
(2:06) Dan Moren: Music products: 9.1 million iPods, compared to 10.2 million in the year ago quarter.
(2:06) Dan Moren: In September, announced new iPods. iPod share of US market for MP3 player is still over 70 percent, according to NPD.
(2:07) Dan Moren: iPod also continues to be top-selling MP3 player, and gained share internationally year over year, according to latest data. Remain in target range of 4-6 weeks of iPod channel inventory.
(2:07) MacJournals.com: (CNBC again saying that Apple "missed" on its iPad sales. Unreal.)
(2:07) Dan Moren: iTunes Store had a strong quarter, revenue over $1 billion. Launched iTunes 10 in September.
(2:07) Dan Moren: Also introduced new Apple TV for $99.
(2:08) Jason Snell: That really is an enormous iPhone number.
(2:08) Dan Moren: iPhone: 14.1 million sold compared to just under 7.4 million in previous September quarter—91 percent year over year growth. Compared to 64 percent growth for smartphone overall in the quarter.
(2:08) Dan Moren: 8.82 billion compared to 4.61 billion in the year ago quarter, an increase of 92 percent.
(2:08) Dan Moren: 8.6 billion is an ASP of $610roughly.
(2:08) Dan Moren: 166 carriers in 89 countries.
(2:08) Dan Moren: Very strong year over year growth in Asia, Japan.
(2:08) Dan Moren: Very happy to be shipping iPhone 4 in China as of last day of quarter.
(2:09) Dan Moren: Last month, J.D. Power and Associates, reported that iPhone ranked once again highest for customer satisfaction in smartphones.
(2:09) Dan Moren: Adoption of iPhone in enterprise still accelerating. Since iPhone 4 shipping from 60 percent to nearly 80 percent of Fortune 500 countries.
[Danny Guttridge: Why did their stock just drop 18 points?]
(2:09) Jason Snell: Danny, that's what always happens. People who targeted higher sell, other people take profits and get out.
(2:10) Dan Moren: Proctor and Gamble, GE, Pfizer and more, have made iPhone available to employees. About 3.3 million iPhone in channel inventory. Still have sizeable backlog and could have sent more if they could have made them fast enough.
(2:10) Dan Moren: Sold almost 4.2 million iPads.
(2:10) Dan Moren: over 65 percent of Fortune 500 are deploying or piloting the iPad.
[Joel Housman: Stock prices do not react positively to good news. You buy on the rumor, sell on the news.]
(2:10) Dan Moren: Recognized revenue for iPad/accessories, $2.8 billion; $2.7 billion for the iPad, so $645 ASP.
(2:11) Dan Moren: Bewteen 3-4 weeks of channel inventory, below target range of 4-6 weeks. Adding Verizon, Walmart, Target, and AT&T stores. Expanding distribution internationally.
(2:11) MacJournals.com: 3-5 weeks of channel inventory of iPad models means they're not bloody likely to introduce a new model in the next quarter.
(2:11) Dan Moren: iOS device sales of 125 million passed last month.
[Kohlmannj: How many total iPads at this point, guys?]
(2:11) Jason Snell: 7.5 million total iPads
(2:11) Dan Moren: During Sep. quarter, released iOS 4.1, bringing features to iPod touch and iPhone customers.
(2:11) Dan Moren: Plan to release 4.2 in November, bringin iOS 4 to iPad.
(2:12) Dan Moren: iOS 4.2 will also include AirPrint, allows printing from iOS devices over Wi-Fi without the need for drivers or software.
(2:12) Jason Snell: Inventory of iPads built about 500K over the past quarter, so they've got more in the channel but still not as many as they'd like
(2:12) Dan Moren: App Store continues to be an unparalleled success. Over 200,000 registered iOS developers. Including over 65,000 games/entertainment and over 30,000 iPad apps.
(2:12) Dan Moren: Launched iAd in July. Very happy with results so far. Customers love the ads, marketers are very pleased with viewer engagement.
(2:13) Dan Moren: On to retail. Record breaking quarter. 3.57 billion compared to 2.04 billion, an increase of 75 percent. 874,000 Macs solds compared to 670,000, up 30 percent.
(2:13) Dan Moren: About half of Macs sold to customers who had never owned a Mac before.
(2:13) Dan Moren: Opened 24 stores, including 16 international stores.
(2:13) Jason Snell: Once again, the "half the macs to new users" stat!
(2:13) Jason Snell: Apple Retail: just keeps on rolling.
(2:13) Dan Moren: New Beijing and Shanghai stores opened on last day of quarter and were the highest revenue ever.
(2:13) Dan Moren: Entered 11th country, meaning 317 stores worldwide and 84 outside US.
(2:14) Dan Moren: Average of 301 stores open during Sep quarter, average revenue per store was 11.8 milion.
[Guest: Anyone know how many Macs in use (to compare to 125M iOs devices: call it 120M in use)?]
(2:14) Dan Moren: Hosted a record 75 million visitors, compared to 45 million in year ago quarter.
(2:14) Jason Snell: Apple store attendance (total visitors) up 62% year over year. Astounding.
(2:14) Dan Moren: Expect to open 40-50 stores in fiscal 2011, with only 50 percent of them outside the US.
(2:14) MacJournals.com: Apple has not updated the "Mac installed base" stat in many years; the last I heard, they were still using the 25 million stat from 10 years ago. It's probably been that long since they said it, too. It would be a great question to ask.
(2:14) Dan Moren: Begin replacing several stores in the US.
[JohnF: The half the macs to new users seemed to be limited t 'in-store' sales..maybe not half of ALL macs sold.]
(2:14) Dan Moren: Total company gross margin 36.9 percent, 190 basis points above guidance.
(2:14) Jason Snell: Yes, it's always 50% of people buying Macs in retail.
(2:15) Dan Moren: Driven by lower commodity cost and a better than planned mix of iPhone sales.
(2:15) Dan Moren: Tax rate lower, because of higher mix of foreign earnings and discreet one time tax bonuses.
(2:15) Dan Moren: Cash plus short term/long term securities total $51 billion, compared to $45.8 billion at end of June quarter.
(2:15) Dan Moren: Cash flow from ops, $5.7 billion.
(2:16) Jason Snell: Listen along with the conf call at http://stream.qtv.apple.com/events/oct/earnings/earnings_10/earnings_ref.mov
(2:16) Dan Moren: In fiscal 2010, establishing record sales of over 13.6 million Macs, 31 percent year over year growth.
(2:16) Dan Moren: Introduced iPhone 4, 40 million sales. An increase of 93 percent over fiscal 2009.
(2:16) Jason Snell: Man, that Antennagate really killed Apple.