Apple bucks recession, records best non-holiday quarter in company history
By Darren Murph 
posted Jul 21st 2009 5:18PM
posted Jul 21st 2009 5:18PM
The company also confessed that the iPhone and iPod touch was cannibalizing traditional iPod sales (defined by Apple as the "shuffle, nano and classic"), but so long as those purchases stay within the realm of Apple, we're sure it doesn't much mind. The firm was also quick to boast of a 626 percent increase in iPhone sales from this quarter a year ago, but considering that its handsets were only available in a handful of nations then compared to scores of countries now, we still maintain that next quarter's iPhone sales will be the real measuring stick. Still, Peter Oppenheimer -- Apple's senior vice president and Chief Financial Officer -- did admit that the company was currently unable to meet iPhone 3GS demand in virtually every country where Apple is shipping it to. Which is funny, since we haven't heard of too many Americans that are still having trouble locating one. When talking about iTunes, we were reminded of the 1.5 billion total applications downloaded from the App Store, while some eight billion jams had been purchased (both since launch). In fact, Apple claimed that it was "years ahead" of rivals when comparing the App Store all those other application markets. Finally, Mac sales scooted up some four percent with a grand total of 2.6 million unit sold, which went down as the company's best-ever June quarter in terms of personal computer sales.
When asked (again) about the possibility of Apple introducing a netbook, we were reminded that Apple "isn't out to make the most computers, just to make the best computers." Furthermore the suits at the company have yet to figure out how to build "the best" at the "$299, $399 or $499" level, once again extinguishing any hope of a low-cost Mac laptop anytime soon. He went on to say that "some customers buying these [netbooks] become disappointed / disenchanted," asserting that Apple is simply striving to make the "best, most innovative" machines and "give customers the most value." To quote Mr. Oppenheimer when responding to a question over an iPod-like device with a larger screen:
"I never want to discount anything in the future and never want to talk about new products. People want a full-featured notebook, some of the netbooks being delivered are very slow, have software technology that is old, don't have a robust computing experience, small display, cramped keyboard, I could go on but I won't. We'll only play in things where we can be very innovative and be proud of."Okay Apple, we get it -- you're not interested in the netbook space. Gosh.
Never used a Mac, or homophobic?
Aww, only 5.2 million iPhones? Apple barely beat out Palm Pre ...what's the total for Palm Pre now, 500k yet?
Congrats, your phone of choice sold more than someone else's phone of choice. You must be so proud. (I own neither phones and have no vested interest in either but reserve the right to reply to douchy comments.)
LOL, I have an even better commercial.
Paul A. Chapel dies in a fire.
She is creepy as all hell. Besides that though, you have to admit that AT&T's network coverage sucks. 1/2 the time I am trying to look at the real internet I am stuck waiting for it to talk to the damn network.
@Duke: When not looked at closely your profile pic looks like Master Chief. It's always disturbing to look closer and realize it's a cat.
You should see that cat when it has a gun! Talk about disturbing.
Good set of results there and quite interesting - it's clear the Macbook sales have benefited from a product refresh and a drop in prices and hopefully this will continue. The iPhone is no surprise - I don't get why people don't realise it's an incredibly popular device and a 15 million a year seller (although I don't think it'll go much higher than that). iPod decline is no surprise either. The Shuffle was a disaster and converged devices are definitely the way forward.
Good stuff and hopefully a sign that the wort of the recession is over.
Ah, smell the salt from the sea of a billion Apple haters' tears...
GJ, Apple. Suck it, haters.
"The real internet"
Because there is some other internet out there that anything not an iPhone uses?
I think some people are believing the marketing they are hearing a little too much.
If I had the money, I would pay to have @rcam's commercial idea brought to life.
Wonderful. Brilliant. Genius.
@Sy
Try and not to rub their noses into the dirt or they'll run home crying to their mamas that their item of preference is subpar in nearly every respect when compared to the iPhone. Who cares how many Pres or Nokia N97s are sold? It really doesn't matter because neither of their unit sales or number of apps amount to a hill of beans. Go Apple and make me some more money.
@iphonerulez
"Go Apple and make me some more money."
You truly are delusional.
This is getting old. Paul is a douche with a huge superiority complex. The end.
As Maverick pointed out, nobody said the iPhone wouldn't sell we'll and everyone is entitled to their opinion on the phone. Just because you think it's best doesn't mean it is. Get your head out of your ass and stop being such a turd flinging moron.
I think the point which needs to be made here is:
No one cares. If you do, then stop caring. It's a dam phone.
They can't keep up with the demand of the iPhone. Crazy.
I bought mine 2 weeks ago at an Apple store, they had plenty of stock.
Don't listen to everything the internet tells you.
Everywhere I go, places that have Apple products, have tons.
Hell, they are still trying to sell those last year Shuffles.
In Mexico, a lot of Apple products being sold are sometimes up to two years old. Maybe they ship the overstock?
If you heard it or read it, then it must be true, especially coming from people who wants to sell you stuff...
iPhone 3GS is completely sold out in most places across Canada, can't dream of getting one from Fido or Rogers (by phone or internet, might have luck in a local store) in the next month at least. It seems that Apple overestimated demand in the US but underestimated most other locations...
No discussion on the PC sales, what is there core business?
PC? MAC PCs are dead @Cupertino, it is just in the inventories for legacy/heritage purpose.
Apple's core business is any business that makes them money.
Sales of Macs up to 2.6 million, up 4%.
@ Momo
click the read link sometimes.
"Apple sold 2.6 million Macintosh® computers during the quarter, representing a four percent unit increase over the year-ago quarter."
@ momo "No discussion on the PC sales, what is there core business?"
2.6 million up 4%. Shows how well the microsoft ads are working. Heaven forbid what the sales would have been if the "Laptop Hunters" campaign hadn't aired.
In fact I would go so far as to suggest that the Laptop Hunters campaign is actually working in Apple's favour cementing in the minds of the watchers that Apple is actually the machine to aspire to rather than the cheap stuff the "real people" end up buying.
I wonder how Kevin Turner is feeling today? Perhaps the "call" from Apple legal was to tell them to stop running the commercials BECAUSE THEY WEREN'T WORKING.
Well yeah, but I wonder how many of those sales are down to a product line refresh and the price drop.
Interesting that Apple didn't take this opportunity to deny making the call though.
It was their core business when they were still called Apple Computers Inc. a few years ago. There's a reason they dropped the "Computers" from their name, which is precisely this, that computers are no longer their core business.
"Interesting that Apple didn't take this opportunity to deny making the call though."
They have no reason to. The call was made because Microsoft continued to falsely advertise the price of the MacBook Pro in their ads. Microsoft then stopped running those specific ads. Kevin Turner's mischaracterization of the events and the sensationalist headlines by the likes of Engadget and other sites blew it way out of proportion.
theyre so sad that they wont even mention that, do u remember when they called microsoft to stop running those laptop hunter adds? thats how you know they either gained a little or lost revenue
Apparently, Apple's core business is whatever they can use to drive sales to make money at the moment. That's just flexibility. Likely a lot better than just having nothing to offer consumers. This economy is not fostering desktop sales no matter which company it is. You're right for suspecting poor sales in their computer line, but revenue is revenue no matter which division it comes from and that's what really matters.
My God iTards all over the world ll be on a roll tonite.
I can see Paul A. Chapel, Quix crawling out of their wormholes already
They're in wormholes? My God, Stargate was right...
@Mark lol, I see what u did there.......
Somebody has to keep the trolls (i.e. you) from storming the castle, bjay.
P.S. please don't drown in your Apple-hating tears tonight...
When you say iTards, iDiots, etc, it's akin to saying Micro$oft/M$.
It's not clever, it's not funny, it just makes you look like a cock.
How can Mac sales be up 4% in this economic climate while sales of PCs are down? Those Laptop Hunter ads are supposed to crush Apple and make PCs cool again.
That ad campaign is awful isn't it.
because the recession stopped being the main story on the news (they ran out of things to say), stupid people started believing it was O.K. to blow loads of money on stupid things again.
@MacVista
i can see why apple is doing good, its because they have women wear an ipod for underwear
PC market is pretty much saturated, though netbooks sales are growing. Mac sales, 4% is not that great considering new products and lower prices.
I thought "I'm a Mac" ads would crush PCs. Well, good luck with that. Hope you live long enough to witness it. LOL.
This is why Apple wont make a netbook. It would eat into the sales or their Macbooks - like netbook are eating into the sales of PC and laptops. People woule prefer to have a fully featured machine but at the prices of netbook you just cant resist living with some of the minor shortcoming.
I would say this is more true for the Apple market as most of the users just wanna be seen to own an Apple (power users pipe down I know you are out there as well). Although the would pull in a lot of current netbook owners they would see the sales of Macbook tank.
More propaganda from Apple.......in reality they are losing market share in all their manufactured items
Proof, please.
You're proof. I want some links.
any justification for these claims?
@KeatMP: Of course! He IS the proof.
Actually, there is a lot to be said about these numbers when you look into them:
They sold 2.6 million macs, a 4% growth over this quarter last year, with mac portable shipments rising 13%. If I remember correctly, last year it was about 50-50 between portable and desktop. That means their desktop sales plummeted 17% over last year.
The average selling price for their 'mac laptop' went from $1,440 last year to $1,250 this year, a 14% drop in per unit price, which is likely cutting into their per unit revenue by about 20%.
iPod sales were down 7% compared to this time last year - and it appears they're double dipping to include the iPhone in those numbers.
"Music. 10.2 million iPods, down from 11 million year ago quarter. A few reasons: reduced channel inventory by over 400,000. Sell through declined by 4% year over year. How are we looking at this market? Three categories of pocket product: traditional MP3 players (shuffle, nano, classic), iPod touch, and iPhone."
Apple is a master in gaming the earnings call to get headlines like this.
@GeekPI --
Again, read the statement (and the actual numbers), not just the coverage from websites.
The iPhone is not included in the iPod line. The small (7%) drop is understandable with a similar feature found on the higher-end product. When a customer buys a iphone, they often do not buy a ipod nano, shuffle, touch.
Gib - the quoted area is direct from the conference call transcript.
Apple is indeed master of propaganda, PR and marketing. If it wasn't a consumer electronics company, it would have been a PR and marketing consultants firm.
Shake Your Money Maker!
hey
I take it that you knew this before it was posted, and that's you have been formulating a comeback.
I could say "welcome back!", but I'm too tired.
Oh and by the way, let the MSFT vs. AAPL bout #14432 commence.
Oh, you're still alive...
Apple is doing just like me, choosing not to participate in a recession.
It's really easy to not let a recession affect you. Just get a job!
I honestly thought you had flung yourself off a bridge or worse all your MAC PCs die on you
whats up?
Well done, Apple. Didn't M$ have to lay off workers? LET THE DOWN RANK COMMENCE!
+1.
The down rank is for the lame use of M$.
hey i can do that too! App£e. real cool, isn't it?
You could have gone one better app£€
Extremely impressive. Great business model.
But but I thought Engadget was only a gadget blog! Are you going to report MS' report in 2 days when they are going to report 2x more revenue an profit than Apple (eventhough they are going to be lower than last year) ?
2x? Woah, that must be a huge loss on their part..
Engadget reports on the Microsoft earnings gained by its monopoly on the computer market all the time.
http://www.engadget.com/2009/04/23/microsoft-profits-sink-for-the-first-time-in-23-years/
http://www.engadget.com/2008/01/24/microsoft-trumpets-record-second-quarter-results/
http://www.engadget.com/2007/10/26/microsoft-has-an-okay-quarter-posts-4-3b-profit/
Yup, Engadget are pretty fair here.
I wonder if Microsoft's earnings will include pre-orders of W7? That would be interesting.
Some other companies also reported today also....
Where is out writeup?
well with all that profit its about time they sorted out the shit build quality of there products
Oh dear, he's talking to himself again...
Someone call the crisis center.
Paul, does this dress make me look fat?
iPhone sales rose so dramatically because Apple stopped production of the 1st Gen iPhone in Q1 2008 so no-one had stock in Q2 2008. The 3G model didn't really take hold until Q3.
Exactly, but the people here shouldn't let facts affect their reality.
Or how about that at 5.2M phones even Motorola shipped twice as many phones. We won't even mention the fact that Nokia did that many while you read this article.
Apple is a fine little company but people forget that they are a niche market company in cell phones.
@JSWinston
Ya, motorola may sells more phone, but they also lost money. ($230M) for the Q2. Selling a lot for a lost doesn't do you any good.
Wait, wait, wait , wait a sec. We have to give some credit to Microsoft. With these dumbass commercials they finally created something that worked and made a lot of money... for AAPL. :) LMAO!!! Expect an even more dramatic increase in sales once the Microsoft stores are in place, right next to Apple stores, making it even more obvious what the sane and educated choice is.
Cue river of bullshiit nonsense of all kind from MS apologists living on this blog in 3, 2, 1....
Good job Apple! Despite the barrage of lies and FUD from your competitors, well more like copycats, your fantastic products continue to succeed! Good to hear Mr. Jobs back at the helm.
'The outfit continued to steamroll the competition in MP3 sales, moving 10.2 million iPod units in the quarter; of note, that was a seven percent decrease from last year, but given that fact that we're getting ever-closer to a saturation point with these things, we aren't too shocked to hear it.'
Incorrect, the 10-Q says iPod unit sales were up 3% quarter over year (page 29). The profits on them are down about 8%, due to making only $151 per iPod sold instead of the previous $171.
@ Paul
You sir are amazing! I applaud you for being consistent and more importantly RIGHT.
The anti apple losers here just can't seem to face the music. The iPhone is the BEST phone out there and you all know it. Apple once again comes out on top. In this shitty economy no less.
Quite impressive if I say so myself. Now I may not like Mac OS X but I do love Apple as a company and I love my iPhone 3G S.
Cheers.
And to the haters you can keep screaming and downvoting Paul all you want. All it does is validate what he's saying. Plus you just look petty.
Margins...margins...Margins.. hell if i sold computers that overpriced to people who really only websurf and edit pictures generally i better have record revenue and earnings
CONGRATS APPLE.
Granted i love America but when Crocs starting having record sales I gave up on thinking Americans or society in general really carried about value or taste.
Bitter much? You're just mad because you haven't figured out how to sell anything with high margins. And I work in a studio full of people using Macs who would love to disagree with you about not using them for anything more than web surfing and editing pictures. I mean you'd have to be all kinds of stupid to actually believe that.
And I fail to see how buying a Mac isn't a value proposition. Have you seen how much they resell for? Not to mention the amount of time they last, which on average is a good couple years longer than PCs.
@ Zak
not bitter at all. I have 3 computers in my house
1.built myself
2.mac mini HTPC
3.Sony laptop.
And my comment about them being overpriced is an opinion. In 2009 where computer prices have dropped dramatically its really a shame that consumers believe that they need a $1200 laptop with mediocre specs compared to a $600 PC thatll do exactly the same thing. Just with a different experience.. OSX vs Windows.
And i work for a branding company that is large and 90% Macs. I have a G5 on my desk. I dont hate Macs but for the price Apple charges i know i can get a PC for half and still get same or better performance.
Still congrats APPLE ill have to go over the conference call myself to read thru the FUD.
That is a common mistake people make when they assume that specs is all that matters or is even the most important thing to consumers. It isn't and it never will be. Apple knows this but a lot of people just don't seem to get it.
That's the power of branding. It's all about user experience, unique features, and perception. I get what you're saying, but the perception of computers itself is changing. While it used to be enough to just get a computer, now people want "nice" computers. It's like automobiles, there was a time when all people wanted was just to have one, but look at automobiles now. I myself build custom PCs for gaming, but I use Macs for design work. Just because you're someone that works on a 67' fastback in his garage doesn't mean that you can't appreciate a new BMW.
Paul, you're wise beyond your years. Thank you for all the guidance.
@Paul A. Chapel
Still need to sell another 12 million smartphones a quarter if they want to beat (an apparently doomed) Nokia...
@KnightOfEscaflowne: Hmm, considering that it's "the best phone out there" it seems a little odd that it was beat out by the BlackBerry Bold. Not to mention that it was beat out as a platform by Symbian, BlackBerry and Windows Mobile. Oops! Maybe sales numbers aren't the best way to judge a phone...
It's not surprising. They make some of the best computers and phones there are, and with the new MacBook Pro (which is probably the best deal ever for Apple, and a really good 13" laptop deal) I am not the least surprised.
Aaron - which SINGLE MODEL of Nokia's phones sold over 5.2 million in the last quarter alone?
Oh right. None of them. Try not to forget that Apple is doing this with ONE phone.
@ Paul "God, this is such good news, though really. I'm going to take my new girlfriend (who I met at Starbucks while using my MacBook) and we're going to have champagne and caviar."
There are so many things wrong with this sentence, but I'll only focus on the main two:
(1) You actually celebrate the earnings statement of a corporation?! Wow, that's lame.
(2) You actually have a girlfriend?! Wow, that's disturbing. Must have been slim pickings at Starbucks that day.
@Paul: Woah, you're that guy from Best In Show, aren't you?
They're really bashing netbooks in the conference call.
A sure sign Apple has one on the way.
Exactly, and judging by what they're focusing on, it'll be a tablet with an iPhone style OS...
Well, Zak, that's true, but Nokia don't really sell in the US. The Nokia 5800 sold 3.7 million units in Q2 and the iPhone's non-US sales are about 2.8 million so it's pretty comparable.
@Zak, the last time i checked AT&T store i saw two APPLE dumbPHONES
? Me? All I did was comment on you still being alive(since you missed a few key MS/Apple posts earlier), asked if you're the guy from best in show(cause your story of how you met your girlfriend mirrored that) and proved that other guy who was acting like a douche wrong. When did I "hate" on you?
Supplies might be slightly low. Got a 3GS ordered thru AT&T Corporate and it went into backorder status but shipped within 4 days of the order.
Er, it doesn't really work that way. Compare the Nokia 5800's worldwide sales to the iPhone's worldwide sales. The iPhone wins. That's all there is to it. You can't make excuses like "Well Nokia's sales aren't very good in the US", because it's just that - an excuse.
Wtf is wrong with all of you?