While Apple faced bad news today, it also faced some seriously good news. The company announced the financial results for the third quarter of the year, and they are – again – very good, despite the sorry state of the world economy and the PC industry. We can now also say who of the two analyst firms were correct.
I could put the results in running text, but I usually find that method a bit overwhelming and unclear. As such, I called upon my incredible skills of table-making in Excel to produce these wonderful tables:
As you can see, the company is doing very, very well, despite the economic crisis. While companies like Acer see much better unit sales growth in the computing business, the fact of the matter is that most of those sales are netbooks which do not have the fat margins Apple has on its machines. Another interesting note, not in the above tables, is that Apple has stated that 44% of its sales are outside of the US, meaning the US is still the primary base for the Cupertino company.
Also of interest is the article we ran earlier on the predictions by IDC and Gartner. There was a discrepancy between both of them when it came to Apple’s figures in the US, but it seems like Gartner was closer with predicting a 2.5% sales increase for Apple in the US.
Cue the ‘Apple dying’ chants; a healthy company is a healthy platform that benefits not only shareholders but developers and end users as well. Its nice to know when you plonk down the dollars for a machine that the company will be around in 12 months to support and honour the warranty.
Anyone raising ‘volume’ arguments; GM was the worlds largest producer of cars at one stage, ignoring the fact they were losing money hand over fist – volume means nothing, it is the quality of that volume is is important.
Oh, and poor customers aren’t of any value to a platform if they choose to pirate their software instead of purchasing it.
Profit margins are more important than market share.
No.
Both profit margins AND market share are important.
A huge profit margin with a minimal market share means your revenue is tiny, and tiny revenues are no good in an industry where product development is sometimes in the tens or hundreds of millions.
thats cool
IDC has been way off on their Apple Mac sales estimates all through 2009. Where do these people get any credibility to be quoted all over the web?
IDC, Forrester, IDG and numerous other organisations have always had zero credibility; it reminds me of one company with so-called ‘researchers’ and not a single employee had any qualifications in the field they were were supposed to analyse. The IT company where every person has an English major whose understanding of IT is equal to that of “if I move my finger to the left on the track pad, the pointer followers”.
I remember 10 years ago when I heard these companies going on about how the vertically integrated business model is doomed, that by this time all the RISC vendors would have dumped their own architecture in favour of Itanium or gone bankrupt, there are numerous examples where their so-called ‘research’ is so off base you might as well wave a bloody dead chicken above a plank piece of paper and make decisions on which direction the blood flows on the paper.
Then again, there are idiotic C*O’s out there who would sooner delegate it to these organisations so they can decimate shareholder value through private jets, expensive functions and pointless expos in Vegas – and claim it as ‘reasonable compensation’ for doing sweet f*ck all.
an English major whose understanding of IT is equal to that of “if I move my finger to the left on the track pad, the pointer followers”.
LOL! I think that is about the funniest think you have written to date.
Oh I thought the chicken blood on plank just topped it 😛
You have to pay them money to get the correct reports.
Didn’t you know their business model?
Imagine if they opened the platform up!
They could sell ….. and make …. less money.
…Apple make large profits from the stuff I buy from them. Having worked in this industry for nearly 25 years I’ve seen margins plummet because of the constant whining of people wanting everything for nothing. And lets think about a retail version of Vista Ultimate at around $375. Not bad margin for a box with a DVD in it. But of course it isn’t the box with the DVD in it you’re paying for, it’s the R&D and full company infrastructure that supports the product.
Lets hope Apple and Microsoft keep making their high levels of profit and stay healthy so that R&D can continue and we can have some good competition to keep things moving forward…
Of course, and when the margins are razor thin they then start complaining that Bob from Bombay can’t understand them or complain that they’ve gone through 3 computers in one month due to faulty components or worse, they’re chock full of crapware, adware, shareware, trialware and every other piece of junk with no way to do a clean reinstall that results in a Windows only installation.
It kinda reminds me of the banks in Australia and the number of customers who would prefer paying a little bit more for some decent customer service. Its funny though that the only people who complain about the price of computers and software are computer geeks; most people I know tend to have the attitude of, “well, if that is what I need to pay – that is what I need to pay”.
Of course, but not many people realise this; they see ‘profit’ and they ignore the fact that both companies re-invest almost all the profit back into the company due to either no or very little dividend payments.
Edited 2009-07-22 00:13 UTC
At least seeing these figures combined with the knowledge that the market share of Mac OS X is rising ( http://www.osnews.com/story/21421/Linux_Hits_1_Market_Share_Milesto… ) gives me the confidence that development of this OS will only continue to grow.
Other than the iPhone, I figured this would be a tough quarter for Apple. It’s pretty exciting to see a continuing growth of Mac sales on top of it all.
I’m really curious about the future of the iPod too – it took a small hit. I wonder if the iPhone is just going to eventually take its place. The iPod Classic, for instance, just looks sort of archaic next to its distant cousin. Will they standardize the line with iPod Touches serving as the iPods and the iPhones as the smart phone juggernaut that it is? I could still see a space for a shuffle or nano in that lineup, but why keep the classic around at all?
Yes, the iPhone will take the place of the iPod… Right now there is room for both, but as we see more iPhone models, esp. smaller ones in the future, then these will eat more and more into the iPod sales, which is a good thing.
The death of the iPod probably wont come from MS or Sony (or whoever), but from Apple itself…
When I bought my iPhone I gave my 30G iPod away, why carry two devices?
Just realised that Apple really is pretty irrelevant outside of the US: 4.53% of the world’s population (the US) account for 56% of Apple’s sales.
Amazing growth potential.
Apple targets about 10 to 15% of the world’s population. Given the median acquisitive power among the world’s population, that seems to be about right regarding the percentage which can actually afford their products. That is why they are a business and why they have billions of dollars in the bank, and that is probably one of the reasons why you don’t.
Companies tend to focus in those markets which require a lower effort.
“Just realised that Apple really is pretty irrelevant outside of the US: 4.53% of the world’s population (the US) account for 56% of Apple’s sales”
Crap, even if Apple represents 1% of the total computers sold, that’s already a lot, no way you can call it irrelevant. There are som much personal computers sold in the world (or better to say Microsoft-based computers sold in the world) that even if one company with its own platform has 1% of the market, this is already huge. No other compagnies with its own solution being non Microsoft-based is able to do that today.
Plus, taking this worldwide market share makes little sense by itself, i mean, Apple is totally absent in the biggest chunk of the worldwide market, the one which sells cheap (crappy) pcs. Apple simply does not play there, and this 1% market share takes that into account even though Apple is not in this big market. On top of that if you add that Apple is absent in some geographical markets that do contribute a lot to the Microsoft-based system sold in the world, it becomes obvious that saying that Apple has 1%, 2% or whatever percentage of the worldwide market share says nothing about how well Apple is doing.
Dividing the worldwide market into segments is much more meaningful, the $1000+ segment (from a recent NPD study, Apple owns 91 percent of this market in US, yes 91 percent!!!), the education segment (Apple is doing really well in a lot of countries), the pro market, the scientific market, both being well occupied by Apple, and so on….
Edited 2009-07-24 13:49 UTC
“It’s a pc”
Microsoft, your crappy ads are not working, better stop them i guess….
And what is his name? Oh yes Kevin Turner, Microsoft’s Chief Operating Officer they call him. So now lets see if he will keep saying that Apple is calling him for stopping Microsoft ads. How they call them? Yes “Laptop Hunters”, better call them “Microsoft hunters”……