IT Industry

7 greatest hits from Apple's quarterly earnings call

Apple continues to party like it's 1999, the height of the dotcom boom. While other companies struggle with the recession, Apple turned in another banner quarter, breaking revenue records and enjoying voracious demand for the iPad, the iPhone and Mac. Here are seven highlights from Tuesday's earnings call.

Recession? Apple hasn't heard about it.

Mac and iPad sales pushed Apple to record revenue in the third quarter, with sales of $15.7 billion, up 61% year-over-year, and net profit of $3.25 billion.

The iPhone bug doesn't seem to have hurt sales

Consumer enthusiasm for the iPhone 4 doesn't seem to have been diminished by reports of problems with the device's antenna. We can't know for sure as the quarter closed June 26, before reports of the problem became widespread and just two days after the phone went on sale. We won't really know how much the iPhone 4 problem hurt sales until the next quarterly conference call.

However, Apple told analysts at its quarterly earnings call Tuesday that demand for the iPhone continues strong.

"My phone is ringing off the hook for people that want more supply," said chief operating officer Tim Cook, according to a PCMag report. He said there's really no way to know whether reports of the problem have diminished demand for the iPhone 4, because demand is greater than Apple's ability to fill it. iPhones ordered on the Apple Web site today ship in three weeks.

iPad buyers aren't just early adopters.

iPad demand is also outstripping supply, orders placed online now ship in 7-10 days.

The iPad is selling faster than the iPod did, Cook said, according to a report on Macworld. Apple took more than 20 months to sell its first million iPods, but sold a million iPads in a month.

The iPad "is not following a typical early-adopter curve, taking a long time to cross into the mainstream," Cook said. "Our guts tell us that this market is very big, and we believe that iPad is really defining the market."

Apple isn't afraid of the iPad cannibalizing Mac sales

Cook said Apple hopes the iPad will boost Mac sales while cannibalizing the sales of PCs, according to Macworld.

"I think most people external to Apple focus on cannibalization as a negative, and internally we focus on exactly the opposite," Cook said. "The Mac has outgrown the market 17 straight quarters -- however, the Mac share is still low. And so there's still an enormous opportunity for the Mac to grow. Certainly the more customers we can introduce to Apple through iPad, iPhone, and iPod, you would think that there might be some synergy with the Mac there. And there may be some synergy between the iPad and the iPhone as well... This is where it's great to have a lower share, because if it turns out that the iPad cannibalizes PCs, I think it's fantastic for us, because there's a lot of PCs to cannibalize. It's still a big market."

Mac sales are still going strong

Apple sold 3.47 million Macs, another quarterly record that beat previous high sales by 100,000 units. Apple's 33% sales unit year-over-year growth topped the 22% growth rate IDC projects for the overall computer market, according to Macworld.

Apple is getting stronger in the enterprise

The iPhone is at 80% of Fortune 100 companies, 60% of Fortune 500, 400 educational institutions have approved the iPhone for use by faculty, staff, and students. The iPad is in 50% of Fortune 100 companies, according to MacRumors.

The Mac isn't the mainstream of Apple's business

Devices running MacOS comprise 33% of revenue, with iOS products making up for the remainder. Of these, the iPhone is the biggest share, with 40%, followed by the iPad with 16% and the iPod with 11%, according to GigaOm's Apple Blog.

Mitch Wagner

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is a freelance technology journalist and social media strategist.

Copyright © 2010 IDG Communications, Inc.

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