Record iPad sales can't keep Apple from missing expectations
New products this quarter will decrease gross margins, says CFO
Computerworld - Apple on Tuesday announced record sales of its iPad tablet, but missed Wall Street's consensus on total revenue.
During an earnings call with analysts and reporters, Apple said it had sold 17 million iPads, an increase of 84% over the same period last year, and 26 million iPhones, or 28% more than it dealt out in the second quarter of 2011.
Total revenue of $35 billion, however, missed Wall Street's expectations of between $37 and $38 billion, depending on the source. Sales were up 23% over last year's second quarter.
Net profit was $8.8 billion, up 20.7% from 2011.
"It was certainly not bad, but short of what the Street expected," said Van Baker, an analyst with Gartner.
Others said much the same.
"They are performing well, they're growing, they're immensely profitable and they're executing their strategy," noted Ezra Gottheil of Technology Business Research. "But growth was merely impressive, and not explosive."
The clear star of the quarter was the iPad, Apple's two-year-old tablet. Its share of all revenue jumped from 16.6% in the first quarter to 26.2% in the one ending June 30.
That ended a short-lived trend where the iPhone fueled more than half of all sales: For the last two quarters, the iPhone accounted for over 50% of the company's sales. Last quarter, however, the success of the iPad pushed the iPhone's contribution under the bar to 46.4%.
"The iPad was the brightest point of all," said Gottheil. "It was a pretty spectacular quarter [for the tablet]."
The quarter was the best-ever three-month stretch for the iPad, with the 17 million tablets besting the previous record of 15.4 million in 2011's fourth quarter by 10.4%. iPad revenue of $9.2 billion was also a record, but barely so: Sales were just 2% higher than that earlier record.
Apple has sold 26.3 million iPads in the first six months of 2012. One million of the 17 sold last quarter went to educational buyers, said Peter Oppenheimer, Apple's CFO.
While the iPhone's importance to revenue decreased slightly, Apple sold 26 million, a record for the June quarter, said Oppenheimer. iPhone sales totaled $16.2 billion.
What many pundits focused on, however, was that iPhone sales were down 26% from the first quarter, when Apple sold 35.1 million units.
Both Oppenheimer and CEO Tim Cook attributed the slowing of growth and the sequential dip to several factors, including struggling economies in some parts of the world, notably Europe; high inventories during the first quarter as the company ramped up supply to meet demand for the iPhone 4S; and what Cook called "rumor and speculation" about a next-generation smartphone.
- Hands on: Apple's Mac Pro is the fastest Mac ever
- Apple CFO to retire in September after he cashes in $53M stock award
- Apple's CarPlay to spark mobile apps war in your car
- Apple retires Snow Leopard from support, leaves 1 in 5 Macs vulnerable to attacks
- Apple patches critical 'gotofail' bug with Mavericks update
- Why Apple needs a $700 MacBook Air
- Apple takes top spot in brand value computation
- Apple gets a patent for health-monitoring ear buds
- Apple shifts to hardware-first TV strategy with revamped set-top box
- iTunes is almost as big a biz as OEM Windows
- 15 Non-Certified IT Skills Growing in Demand
- How 19 Tech Titans Target Healthcare
- Twitter Suffering From Growing Pains (and Facebook Comparisons)
- Agile Comes to Data Integration
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
Changing the Way Government Works: Four Technology Trends that Drive Down Costs and Increase Productivity
This paper discusses four technology-based approaches to improving processes and increasing
productivity while driving down department and agency costs.
- Aberdeen Group: Marketing Analytics for Manufacturing: Forging Customer Insights There are no recalls for poor marketing. Manufacturers need to get their customer intelligence and messaging right the first time. Learn how.
- The Brave New World of Customer-Centric Manufacturing The Unique Opportunity for Manufacturers to Better Understand their Consumers
- See the Possibilities Utilizing Data Visualization Do you simply want to collect data, or do you want to derive business insights from it? What if you could quickly and...
- The New Way to Work Knowledge Vault This Knowledge Vault focuses on how, in today's increasingly virtual world, it's more important than ever to engage deeply with employees, suppliers, partners,...
- Getting Ready for BlackBerry Enterprise Service 10.2 Find out how BlackBerry® Enterprise Service 10 helps organizations address the full spectrum of EMM challenges, while balancing the needs of both the... All IT Industry White Papers | Webcasts