IT Industry

Apple has record quarter on lower priced Macs, iPhones

...and there are more price cuts coming this quarter.

Apple lowered its price points on several lines of its most popular products this year. This quarter shows that tightening the margins a bit had a huge effect on sales, which also broadened Apple's market share. That, in turn, lit up Apple's stock price to well over $200.

The starting price for an iPhone dropped from $199 to $99. On one of Apple's most popular MacBooks, the 13" Unibody MacBook, Apple dropped the price $100 and added a slew of new features.

Apple also dropped the starting price of a MacBook to from $1099 to $999 and lowered the entry level prices on iMacs as well. Apple is selling an iPod touch for $199, $30 lower than previously. Even the Mac Pros, their highest end workstations, saw price drops this year.

Those cuts paid off in sales numbers. Apple broke the 3 million Mac/quarter mark for the first time in its history. They also sold 7.4 million iPhones in a quarter where, until just a few weeks ago, they weren't able to catch up to demand.

iPod sales overall were down, but iPod touch numbers grew 100% (mostly at the expense of the Classic and Shuffle, I'm assuming) over last year's numbers.

From what Tim Cook, Apple's COO, said at today's earnings call, Apple is going to continue to cut prices:

For the new products we have and will announce, we are delivering greater value to our customers, and these products have lower gross margins than their predecessors.

There's already talk of new MacBooks, Minis and iMacs being released tomorrow. We're likely to see a new starting price of $499 on the Mac Mini as well as more thin-ness in the MacBook and the iMac.

Apple is also expected to release a new "Magic Mouse", a new Keyboard and possibly some new Airports.

There may even be a mystery product thrown into the mix (iPod touch with cameras?)

Copyright © 2009 IDG Communications, Inc.

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