Apple eviscerates Q3 earnings estimates, revenue up 78% year-over-year
7/21/2010 12:10:00 PM
kenmouse
, Posted in
Apple
,
Featured Stories
,
iPhone
,
iPhone 4
,
MacOs
,
Technology
,
0 Comments
Apple’s quarterly earnings conference call ended just a short while ago, and records have been broken.
Apple announced that its fiscal Q3 ending June 26 brought it the biggest revenues and profits ever.
Revenue was $15.7 billion and net profit was $3.25 billion.
Year-on-year these mean growth of 61% and 77%, respectively.
The gross margin was slightly down to 39.1%, compared to 40.9% a year ago.
Apple has started selling the iPad during this quarter, and has so far sold 3.27 million.
The results have exceeded analysts’ estimates, and have triggered a 3.1% rise in Apple share prices in extended trading, after having already gained 2.6% in regular trading.
Apple is still, by far, the most profitable phone manufacturer. Which may be the only metric to matter, especially if you’re an investor.
Apple sold 8.4 million iPhones in the quarter, a 61% growth year-on-year, but fewer than the 8.75 million it sold in the previous quarter. This may be in some way to be expected with Apple, given their unique smartphone release cycle.
But the numbers paint an interesting picture. For example, based on these numbers, Apple now sells 92,000 iPhones a day. For comparison, 160,000 Android devices are being sold each day, 120,000 BlackBerries, 45,000 Windows Mobile devices (yeah, I know) and 260,000 Symbian handsets.
Apple’s market share in smartphones could now be down to 14%, from its peak of 17%, where it has been for the previous 3 quarters.
To know for sure, we’ll have to wait for all the other smartphone manufacturers to post their most recent results, but even if they all report flat market shares, it’s not rosy for Apple.
Sales are growing, since the entire industry is growing, but for the market share to regain growth a change in strategy may be needed. That is, if Apple would want their market share to grow again. They might be perfectly happy with the current situation, and selling one of the highest-margin products (in percentage points) ever made.
If they want to get even bigger, though, they may need to expand the iPhone’s reach even more, in countries where there’s still just one carrier offering it. Starting with the USA. As we noted after Apple’s last earnings call, just offering an iPhone on Verizon would considerably boost sales.
The situation is the same in some other countries. So that may be one course of action.
Another is the dreaded ‘multiple models’ philosophy, which Apple seem to be completely against. Offering a lower-priced (and yes, lower-profit bringing, as a consequence) iPhone version will ensure that the growth will continue for many months.
Whether or not Apple will do either of these things is obviously uncertain. And they’re in no way ‘in trouble’, they just seem to have reached the maximum of what they can achieve with their current strategy for phones.
0 Response to "Apple eviscerates Q3 earnings estimates, revenue up 78% year-over-year"
Post a Comment
Leave Your Thoughts & We Will Discuss Together