Notes of interest from Apple's Q4 2009 quarterly conference call

[AppleInsider]

Apple's fourth quarter of 2009 was the company's most profitable ever, riding high on record Mac and iPhone sales. The company on Monday conducted a financial conference call with analysts and the press. Notes of interest for Apple's results and the now concluded call follow.

On Monday, Apple detailed the results of its fiscal 2009 fourth quarter which ended Sept. 26, 2009, posting revenue of $9.87 billion and a net quarterly profit of $1.67 billion, or $1.82 per diluted share. That's up from revenue of $7.9 billion and net quarterly profit of $1.14 billion, or $1.26 per diluted share, in the year-ago frame.

Apple's regional business segments

Apple Americas accounted for 1.252 million Mac sales and $4.297 billion in revenues. That's a 12 percent year-over-year increase, and an additional 20 percent in revenue from the same frame a year prior.

Apple Europe represented 761,000 Mac sales and $2.491 billion in revenue. That amounted to a year-over-year increase of 25 percent in sales, and 45 percent in revenue for the region.

In Japan, Apple sold 79,000 Macs amounting to $4.34 million in revenue. That was a slight 1 percent increase year-over-year for the region, with a 36 percent increase in revenue from the same frame in 2008.

Other segments, including Asia Pacific and FileMaker Inc., saw a 42 percent increase in shipments and 39 percent growth in revenue based on 291,000 Mac sales generating $7.81 million in revenue.

Apple's "Other Music Related Products and Services" segment was responsible for $1.018 billion in revenue. It was a 6 percent year-over-year drop.

Apple's "Peripherals and Other Hardware" added $6393 million in revenue, an 8 percent drop from Q4 2008.

Apple's "Software, Service and Other Sales" segment produced $647 million in revenue, up 18 percent from a year prior.

Apple's Mac business

Apple shipped 787,000 Mac desktops during the fourth quarter of 2009, amounting to $1.086 billion in revenue. That was a 20 percent decline in revenue for the desktop business compared to a year prior, with 16 percent fewer machines sold.

But the portable business boomed, with 35 percent growth in sales and 27 percent growth in revenue. That equated to sales of 2.266 million Mac laptops generated $2.866 billion in revenue.

These numbers beat the record from the year-ago quarter. Portables represented 74 percent of Mac mix.

Apple officials are particularly pleased with 42% year-over- growth.

It was a very successful back to school season: 12 percent year-over-year to educational institutions, highest quarterly mac sales ever for U.S. education business.

50,00 MacBooks sent to state of Maine as part of ongoing One to One initiative.

Snow Leopard response has been tremendous. Generated consumer box upgrade sales at twice rate of Leopard.

Tim Cook called the fourth quarter of 2009 the "quarter of the portable." Sales were strong, based on the strength of the lineup announced in June. Back to school Mac sales were the strongest ever.

Upgrade sales of Snow Leopard, including the family and box set, were double that of Leopard over the same five-week period. That was more than Apple planned.

Apple's iPhone and Apple TV businesses

Apple sold 7.367 million iPhones during the quarter, producing $2.297 billion in revenue. That is a 7 percent increase in units from a year prior, but a massive 185 percent increase in revenue from the same frame in 2008.

Response to iPhone 3GS tremendous, and officials are very pleased with JDPower's announcement that iPhone tops the charts.

The iPhone maintained its lead and widened it over the next competitor in both categories.

Looking forward to selling iPhones in China next month, great opportunity in a big market.

Apple plans to expand carrier relationships in the U.K. and Canada,

The App Store has seen unparalleled success. 85,000 apps are available, with 2 billion downloads to date, including half a billion in September quarter.

Recognized revenue from handset sales and accessory payments was $2.3 billion, compared to $806 million year ago.

For much of the quarter, most of the countries were very low in inventory and demand outstripped supply. The situation improved in September and there are now 2.4 million units in the channel.

Launching in China on Oct. 30 on China Unicom. Going to start with 1,000 points of sale and expand further over the next several months. Plans and pricing range from $18/month to $85/month. No projections on volume, but it is a huge market, so it's very important to get started.

Regarding competitors, people are trying to catch up with the first iPhone which launched two years ago. "We've long since moved beyond that," Tim Cook said.

Demand for the iPhone 3GS exceeded expectations. Apple quickly changed orders for components accordingly.

On the advantage of exclusive contracts, Cook said you can test some of the level of innovation that would be more difficult to do with several carriers. Visual Voicemail, in the initial iPhone, was an example of that.

Average sale price of the iPhone in the fourth quarter was just over $600. That reflects both a high mix of iPhone 3GS sales, and the benefit of rebalancing the ending channel inventory towards the higher model.

Over 50 percent of the Fortune 100 are deploying a pilot program of the iPhone.

Over 350 higher education institutions have approved iPhones for faculty and students.

Apple's iPod business

10.177 million iPods were sold during the quarter, amounting to $1.563 billion in revenue. That's about even with the third quarter of 2009 in terms of sales, and a 5 percent increase in revenue from the previous frame. But year-over-year, it amounts to an 8 percent decline in sales and 6 percent drop in revenue.

Apple began the quarter with 3-4 weeks of channel inventory. Sales of iPods were down from just over 11 million in year ago quarter.

50 percent of recent iPod buyers bought, including US, Japan, Australia, Canada, and the U.K.

Customers love the iPod nano's new features.

Sales of iPod touch up 100 percent year over year, riding high on the incredible popularity of app store.

Share of U.S. market remains over 70 percent for MP3 players, according to NPD. iPod was top-selling MP3 player, with gains year over year in almost every country they track.

Began within target range of 4-6 weeks of channel inventory.

iTunes Store had another strong quarter. Customers are loving last month's release of iTunes 9, including LP, Home Sharing, and Genius Mixes, improved syncing, and the store redesign.

iTunes Music Store is in 23 countries. It is the largest online music retailer, offering 11 million songs.

Apple's retail business

Retail outlets accounted for 670,000 of the Mac maker's computer sales, providing 1.867 billion in revenue. That is a 12 percent year-over-year increase in hardware sales, and represents a 9 percent growth in revenue.

Stores had a record quarter, with highest revenue, segment margin, and Mac sales ever. Revenue was $1.87 billion, compared to $1.72 billion last year.

Half of Macs sold were to customers new to the platform.

There were 15 new stores opened, with the total now at 273. With an average of 262 open, average revenue was $7.1 million per store.

Apple Stores saw 45.9 million visitors, compared to 42.7 million in the year-ago quarter.

608,000 personal training session were conducted, with 208,000 memberships.

Overall this year, 26 new stores were added, and 72 were remodeled. Apple opened more stores internationally than in the U.S. for the first time.

In November the company will open its first two stores in France, including the Louvre, and plans another high-profile store on upper west side of Manhattan.

Cook said Apple has seen strong results from its remodeled stores. Apple's retail locations provide the best customer experience in the industry, bar none.

Internationally, average store revenue was up over 20 percent for the past quarter.

Apple's next (Q1 2010) fiscal quarter

Apple expects revenue in the range of about $11.3 billion to $11.6 billion, and diluted earnings per share in the range of about $1.70 to $1.78.

The Financial Accounting Standards Board's rule change for Generally Accepted Accounting Principles will change the way Apple accounts for the iPhone. Now, the balance will be recognized immediately as revenue, rather than spreading over two years.

Only the estimated sales value of the iPhone software upgrade will be deferred in the future. The hardware itself will no longer be deferred.

Apple plans to adopt the new rule a year from now. They have the option of adopting earlier in fiscal year 2010. The change will be complex and they're uncertain on the timing right now, so no more specifics were made available.

Guidance for the September quarter is based on subscription accounting, not affected by new rules. It will be recognized over a 24 month period.

Very pleased with quarter and 12 percent annual revenue growth. Officials are looking forward to additional exciting products coming in the future, and they are confident in their pipeline. Apple is focused on its strategy of offering the best and most innovative products, and officials said they are very enthusiastic about the year ahead.

Gross margin predicted to decline about 34 percent based on four factors: new products with lower gross margin than predecessors; a seasonally higher mix of iPods and fewer Snow Leopard box sales; more air freight; and higher component costs.

Lower revenue projected because back-to-school seasons are over and December quarter is typically driven by holiday purchases.

The guidance includes double-digit revenue growth from last year.

[ View this article at AppleInsider.com ]

[htoelle]

Mr Ballmer I hope you sleep well tonight.

We who support Apple expect MS to show some of the same percentages " RIGHT " in your Dreams Sir.

[xwiredtva]

"Earnings, Earnings, Earnings... Earnings, Earnings, Earnings"

A close friend called me at 4:48 and told me the new NEWs. After this qtr results they are uping the 1yr to ... You ready... $280-$300/sh. They want to see the updates tomorrow and get the timeline for the Mac Tablet Netbook thingy.

[elroth]

Ballmer said just a couple of weeks ago that Windows had recently gained market share compared to Mac. Can he be prosecuted by the SEC for lying to shareholders?

[macshark]

There was no disclosure of the actual number of Snow Leopard unit sales?

Apple shipped 787,000 Mac desktops during the fourth quarter of 2009, amounting to $1.086 billion in revenue. That was a 20 percent decline in revenue for the desktop business compared to a year prior, with 16 percent fewer machines sold.

Desktops is the only area where Apple needs to take some action.

Hopefully, we won't have to wait until mid-January to see some new and exciting iMac models unless Apple is planning an across-the-board transition to Clarkdale and Arrandale for iMacs and MacBooks...

Can we please have a headless desktop model (something bigger/faster/more expandable than the Mini)?

[melgross]

I don't know why they say that the call is now concluded, as I'm still listening to the realtime stream.

[macshark]

Originally Posted by elroth

Ballmer said just a couple of weeks ago that Windows had recently gained market share compared to Mac. Can he be prosecuted by the SEC for lying to shareholders?

Ballmer can always use the No reasonable person would believe us defense...

[bitWrangler]

Originally Posted by elroth

Ballmer said just a couple of weeks ago that Windows had recently gained market share compared to Mac. Can he be prosecuted by the SEC for lying to shareholders?

Actually, he didn't lie.

[melgross]

Originally Posted by bitWrangler

Actually, he didn't lie.

True. For a short time, it dropped, only to rise again shortly after.

[plovell]

Originally Posted by macshark

Desktops is the only area where Apple needs to take some action.

Can we please have a headless desktop model (something bigger/faster/more expandable than the Mini)?

Amen. A "Mini++" would blow the doors off.

One 3.5" drive and space for a second, four memory slots and one PCIe.

Oh, and a power supply that lasts longer than 18 months -- that's essential.

If there is one I'll buy tomorrow.

[digitalclips]

I recall a few weeks back having a disagreement with a certain someone here when they stated AAPL was two years away from its highest level ... May I gloat just a little ?

It will be interesting to see what spin the usual trolls put on this too ...

[kresh]

Originally Posted by AppleInsider

Apple shipped 787,000 Mac desktops during the fourth quarter of 2009, amounting to $1.086 billion in revenue. That was a 20 percent decline in revenue for the desktop business compared to a year prior, with 16 percent fewer machines sold.

The Hackintoshes are really getting into Apple's desktop business. We just upgraded all six desktop computers in our house, we replaced the iMacs, with Hackintoshes. There is no way that I wanted to buy more notebooks on a stand (iMac) or notebooks in a lunchbox (Mac Mini), and the Mac Pros are overkill.

Snow Leopard forced us away from an Apple built Mac. The iMacs we had were not OpenCL ready and could not be upgraded. Apple has a hole in their desktop line you can drive a truck through and no matter how the apologists here try to spin it the numbers don't lie!

[macshark]

Originally Posted by digitalclips

I recall a few weeks back having a disagreement with a certain someone here when they stated AAPL was two years away from its highest level ... May I gloat just a little ?

It will be interesting to see what spin the usual trolls put on this too ...

But AAPL is two years away from its highest level! In two years, it will be $400!

[digitalclips]

Originally Posted by macshark

But AAPL is two years away from its highest level! In two years, it will be $400!

Haha ... I HOPE SO!!! .... or even better

[kpluck]

Originally Posted by elroth

Ballmer said just a couple of weeks ago that Windows had recently gained market share compared to Mac. Can he be prosecuted by the SEC for lying to shareholders?

I certainly hope so. I still can't believe that MS's board got away with lying about his health to investors. Oh, wait a minute...

-kplcuk

[Dr Millmoss]

Originally Posted by digitalclips

I recall a few weeks back having a disagreement with a certain someone here when they stated AAPL was two years away from its highest level ... May I gloat just a little ?

What's to "gloat" about if it's true? The previous high for AAPL was 199.83 on December 28, 2007.

[steviet02]

Originally Posted by kpluck

I certainly hope so. I still can't believe that MS's board got away with lying about his health to investors. Oh, wait a minute...

-kplcuk

+1

People who live in glass houses...

[digitalclips]

Originally Posted by Dr Millmoss

What's to "gloat" about if it's true? The previous high for AAPL was 199.83 on December 28, 2007.

I guess you are not accepting after hour trading.

[Dr Millmoss]

Originally Posted by digitalclips

I guess you are not accepting after hour trading.

A strange remark, which suggests that you don't understand after hours trading. AAPL will almost certainly open higher tomorrow, probably in the neighborhood of 200 if I had to guess, but where it closes nobody knows. AAPL has actually traded above 200 before, but it has never closed above 200. Considering how much I have riding on this, I certainly hope it does -- but after all the ups and downs I've experienced as an investor, I know better than to count on it or to predict anything. I've also learned that people who don't put their money where their mouth is, are usually all mouth.

[iggypop]

taking into account after-hours trades, has anyone noticed how close AAPL is getting to MSFT's market cap?

apple left dell in the dust years ago, and steve jobs couldn't resist rubbing michael d's nose in it. wait till apple's value exceeds that of MS. then the fun begins.

[bigpics]

Originally Posted by macshark

Desktops is the only area where Apple needs to take some action.

Can we please have a headless desktop model (something bigger/faster/more expandable than the Mini)?

Originally Posted by plovell

Amen. A "Mini++" would blow the doors off.

One 3.5" drive and space for a second, four memory slots and one PCIe.

Oh, and a power supply that lasts longer than 18 months -- that's essential.

If there is one I'll buy tomorrow.

If Apple was going to bring out the MMMMT (mythical mid-range Mac mini-tower) they would have done so years ago when the market would have been bigger. I've watched the runes all that time and the reasoning is clear. Consider the article's figures:

Apple's Mac business

Apple shipped 787,000 Mac desktops during the fourth quarter of 2009, amounting to $1.086 billion in revenue. That was a 20 percent decline in revenue for the desktop business compared to a year prior, with 16 percent fewer machines sold.

But the portable business boomed, with 35 percent growth in sales and 27 percent growth in revenue. That equated to sales of 2.266 million Mac laptops generated $2.866 billion in revenue.

These numbers beat the record from the year-ago quarter. Portables represented 74 percent of Mac mix.

On its current roll Apple has done nothing for years but target the fastest-growing, most fluid, largest segments of markets it covets (or in the case of Apple TV one which is still waiting to become one). The mid-range AC-tethered market - however appealing to so many of the hard corps here - hardly qualifies.

I and others have repeatedly noted that the only spur that would lead Apple to release such a machine at this stage - in a shrinking, commodity area with fierce margin pressures - would be if they decided to make a serious push in one or more of the business markets - markets which after decades have never been more than an afterthought in their strategic directions - and the studies indicated it could serve both enough administrative assistants/clerks/etc. and gearheads to justify the R&D, inventory, SKU proliferation, support, etc.

And I still don't see it, even though I still want one. So I suggest getting real on this continuing non-saga. Apple hears you, still appreciate your following and proselytizing, etc., they just can't count enough of you to justify such a nice present in your Christmas stocking, when they're so focused on mining richer ore.

[kresh]

Originally Posted by bigpics

If Apple was going to bring out the MMMMT (mythical mid-range Mac mini-tower) they would have done so years ago when the market would have been bigger. I've watched the runes all that time and the reasoning is clear. Consider the article's figures:



On its current roll Apple has done nothing for years but target the fastest-growing, most fluid, largest segments of markets it covets (or in the case of Apple TV one which is still waiting to become one). The mid-range AC-tethered market - however appealing to so many of the hard corps here - hardly qualifies.

I and others have repeatedly noted that the only spur that would lead Apple to release such a machine at this stage - in a shrinking, commodity area with fierce margin pressures - would be if they decided to make a serious push in one or more of the business markets - markets which after decades have never been more than an afterthought in their strategic directions - and the studies indicated it could serve both enough administrative assistants/clerks/etc. and gearheads to justify the R&D, inventory, SKU proliferation, support, etc.

And I still don't see it, even though I still want one. So I suggest getting real on this continuing non-saga. Apple hears you, still appreciate your following and proselytizing, etc., they just can't count enough of you to justify such a nice present in your Christmas stocking, when they're so focused on mining richer ore.

The problem is that it is a self-fulfilling prophecy type scenario for Apple. Look at their notebooks, they are extremely similar to what other manufacturers offer. They have the same general shape, size, weight, screen - keyboard - trackpad placement, except that they use premium materials.

Take a look at their desktops, the only one that is even remotely similar to other manufacturers is the Mac Pro. The Mac Mini and iMac are like nothing else, are behind on specs, and are a much tougher sale than any of the Apple notebooks. Other manufacturers have a more equal mix of desktop to notebook sales because people want to buy what they offer.

Apple makes no effort in the desktop market and then points to the low numbers to justify their not making an effort there.

[samurai1999]

Originally Posted by kresh

The problem is that it is a self-fulfilling prophecy type scenario for Apple. Look at their notebooks, they are extremely similar to what other manufacturers offer. They have the same general shape, size, weight, screen - keyboard - trackpad placement, except that they use premium materials.

Take a look at their desktops, the only one that is even remotely similar to other manufacturers is the Mac Pro. The Mac Mini and iMac are like nothing else, are behind on specs, and are a much tougher sale than any of the Apple notebooks. Other manufacturers have a more equal mix of desktop to notebook sales because people want to buy what they offer.

Apple makes no effort in the desktop market and then points to the low numbers to justify their not making an effort there.

I think Apple (or SJ) is just philosophically opposed to the normal desktops
- I agree with you that a normal Mid-range desktop would be a good seller, and not really need much R & D
- and if Apple applied their normal margins, it would be as profitable as any other Apple product
- but I can't see Apple doing it now
- they're having too much success, and fun, pursuing other market & product types....

[addabox]

Originally Posted by kresh

The problem is that it is a self-fulfilling prophecy type scenario for Apple. Look at their notebooks, they are extremely similar to what other manufacturers offer. They have the same general shape, size, weight, screen - keyboard - trackpad placement, except that they use premium materials.

Take a look at their desktops, the only one that is even remotely similar to other manufacturers is the Mac Pro. The Mac Mini and iMac are like nothing else, are behind on specs, and are a much tougher sale than any of the Apple notebooks. Other manufacturers have a more equal mix of desktop to notebook sales because people want to buy what they offer.

Apple makes no effort in the desktop market and then points to the low numbers to justify their not making an effort there.

So what would be everybody else's excuse? PC desktop sales have been dropping steadily across the board, with laptops having outpaced them as of last year.

I haven't seen numbers for the most recent quarter, but I would have to assume the rise of the netbook has only accelerated that trend.

[MJ Web]

Then recommended sell @ $80. What a bimbo!

http://www.cultofmac.com/morgan-stan...-estimate/5788

[samurai1999]

Originally Posted by addabox

So what would be everybody else's excuse? PC desktop sales have been dropping steadily across the board, with laptops having outpaced them as of last year.

I haven't seen numbers for the most recent quarter, but I would have to assume the rise of the netbook has only accelerated that trend.

So Apple sold nearly 3x as many Laptops as Desktops
(74% Laptops)
- and I think the general market has only recently passed the 50:50 mark

- so there is still a potential for Apple to sell nearly 3x the Desktop numbers (700K -> 2000K approx)

- ok, there would be cannibalization, and the market would take time to adopt the desktops
- but that's the scale of the opportunity they are not addressing....

[melgross]

Originally Posted by kresh

The Hackintoshes are really getting into Apple's desktop business. We just upgraded all six desktop computers in our house, we replaced the iMacs, with Hackintoshes. There is no way that I wanted to buy more notebooks on a stand (iMac) or notebooks in a lunchbox (Mac Mini), and the Mac Pros are overkill.

Snow Leopard forced us away from an Apple built Mac. The iMacs we had were not OpenCL ready and could not be upgraded. Apple has a hole in their desktop line you can drive a truck through and no matter how the apologists here try to spin it the numbers don't lie!

I doubt hackintoshes are having much of an effect. A few people who are willing to make do with the limitations will do that.

I think people are waiting for the rumored new models. This always happens when new models are about to come out, or are rumored to. This rumor has been out for about two months, half the quarter.

If they do come out soon, we'll see a surge in sales as we always do with new models. And if the rumors are correct, and they're somewhat cheaper, that will seal the deal.

[melgross]

Originally Posted by Dr Millmoss

What's to "gloat" about if it's true? The previous high for AAPL was 199.83 on December 28, 2007.

Quite a few other companies aren't close to their previous highs.

but this time, it's more sustainable. Previously, the P/E was much higher. Sales and profits have caught up with the stock price.

If it goes to "traditional" P/E's again, we'll see $400 soon.

I hope that doesn't happen, as I'd like to see a saner ratio..

[melgross]

Originally Posted by kresh

The problem is that it is a self-fulfilling prophecy type scenario for Apple. Look at their notebooks, they are extremely similar to what other manufacturers offer. They have the same general shape, size, weight, screen - keyboard - trackpad placement, except that they use premium materials.

Take a look at their desktops, the only one that is even remotely similar to other manufacturers is the Mac Pro. The Mac Mini and iMac are like nothing else, are behind on specs, and are a much tougher sale than any of the Apple notebooks. Other manufacturers have a more equal mix of desktop to notebook sales because people want to buy what they offer.

Apple makes no effort in the desktop market and then points to the low numbers to justify their not making an effort there.

Every other company now has AIO's. Apple isn't the only one. And except for one or two junky models, they are all expensive when compared to towers.

It's interesting to note that it's business that wants a headless machine that costs $1,000 sans monitor. But consumer sales are now almost twice that of business and government sales.

That's quite a turnabout, as it used to be the other way around.

Of course, most of those consumer sales average about $600 for computer and monitor, sometimes with a throwaway printer added in.

When talking about laptop sales, they are nudging lower than $500, thanks to all the netbooks out there.

Does Apple want that space? I don't think so. If they got even close, I would get nervous. I don't want to see them become another Dell or Acer.

[aaarrrgggh]

Wow-- the $185 November calls I bought Friday should be interesting to watch tomorrow.

Unfortunately, the overall market is starting to go loco again which might pose longer term risks.

[Quadra 610]

Originally Posted by kresh

Apple makes no effort in the desktop market and then points to the low numbers to justify their not making an effort there.

Those lower numbers are there because no one is really able to sell desktops in this market. The future is in noebooks and portables.

The old "desktop" paradigm is fading. At least Apple's AIOs are a good take on them.

[Quadra 610]

Originally Posted by kresh

The Hackintoshes are really getting into Apple's desktop business.

Yeah, because the average consumer is using hackintoshes!

Wake up. Hackintoshes are an internet, Apple-fansite, tinker-toy geek phenomenom that has about as much representation in the larger market as the same minority that plays around with it and posts about it on AI: little to none.

Lack of demand for desktops are "really eating into Apple's desktop business."

Can we all think outside the AI bubble for just a little while?

[melgross]

I guess I should say it again. People are expecting updates to the iMac, Mini, and even the Macbook lines soon.

We all know what happens to sales when that occurs. The Macbook likely did pretty well because in the call, Apple said that sales to schools were up by 12%, and what do they buy?

Otherwise...

[addabox]

Originally Posted by samurai1999

So Apple sold nearly 3x as many Laptops as Desktops
(74% Laptops)
- and I think the general market has only recently passed the 50:50 mark

- so there is still a potential for Apple to sell nearly 3x the Desktop numbers (700K -> 2000K approx)

- ok, there would be cannibalization, and the market would take time to adopt the desktops
- but that's the scale of the opportunity they are not addressing....

The 50/50 marked was passed late last year. Given the accelerating trend, and the explosion of netbooks, I think it's conservative to figure 60/40 laptops at this point.

So if Apple were to mirror the PC market in general, they might be able to increase their desktop sales a bit. But, we have no way of knowing if those would be new sales or just a shift from the laptops they're already selling, which doesn't do them any good.

Again, I think it's reasonably conservative to imagine that not all additional desktop sales would add to Apple's bottom line, and a certain percentage would simply be Apple customers that opted for an iMac or Mini over a MacBook or MacBook Pro.

Given all that, it doesn't seem like a lot of attention on growing their desktop lineup is warranted. Their mix skews more towards laptops than the general PC industry, but not outlandishly so, and that's against a market with loads of bargain basement beige boxes to choose from. And that's within a market that's clearly trending away from desktops altogether.

[digitalclips]

Originally Posted by Dr Millmoss

A strange remark, which suggests that you don't understand after hours trading. AAPL will almost certainly open higher tomorrow, probably in the neighborhood of 200 if I had to guess, but where it closes nobody knows. AAPL has actually traded above 200 before, but it has never closed above 200. Considering how much I have riding on this, I certainly hope it does -- but after all the ups and downs I've experienced as an investor, I know better than to count on it or to predict anything. I've also learned that people who don't put their money where their mouth is, are usually all mouth.

I am sorry you feel the need to be less than pleasant. My original post was made in good humor as was the second. I spent many years working for Apple and my investment is considerable, including my entire IRA which I moved to Apple when it was at $37. I stand by my original point made a few weeks back that I believe AAPL would pass its highest value point soon, not in two years. I base this on absolutely nothing but faith .

[brucep]

the nano phone will soon be here

[Dr Millmoss]

Originally Posted by digitalclips

I am sorry you feel the need to be less than pleasant. My original post was made in good humor as was the second. I spent many years working for Apple and my investment is considerable, including my entire IRA which I moved to Apple when it was at $37. I stand by my original point made a few weeks back that I believe AAPL would pass its highest value point soon, not in two years. I base this on absolutely nothing but faith .

I took your post, and the followup, as unpleasant. Sorry, but the "humor" didn't read at all. Your original point also doesn't stand, since it was December 2007 when AAPL last closed just short of 200. By my calendar, that's only two months shy of two years ago. I never said more than that about AAPL taking two years to get back to where it was, which is a fact, not a prediction. Also, your remark about my not "accepting after hours trading" does suggest that you don't understand what it is. Or was that a joke too? Ha. Ha.

I get the faith part, but I can't afford faith in my investing. You might also notice that I never predict the direction of the market and don't pretend to give anyone advice on what to buy and when. Maybe more people should adopt that policy, unless they're willing to offer a money-back guarantee.

[Dr Millmoss]

Originally Posted by melgross

Quite a few other companies aren't close to their previous highs.

but this time, it's more sustainable. Previously, the P/E was much higher. Sales and profits have caught up with the stock price.

If it goes to "traditional" P/E's again, we'll see $400 soon.

I hope that doesn't happen, as I'd like to see a saner ratio..

True, I haven't got anything in my portfolio that has recovered nearly as well as AAPL. But I'm going to stick by my policy and not try to predict future price. So much can happen between now and a year from now. I never heard anyone predict that AAPL would fall by 60% in just a few months (even as profits grew), but it sure as hell happened. The current ratio may be more backed up by dollars than it was before, but this is not necessarily a sign of sanity. In so many ways, the stock market is not a rational place. That's one thing I've learned the hard way.

[bigpics]

Originally Posted by kresh

Take a look at their desktops, the only one that is even remotely similar to other manufacturers is the Mac Pro. The Mac Mini and iMac are like nothing else, are behind on specs, and are a much tougher sale than any of the Apple notebooks. Other manufacturers have a more equal mix of desktop to notebook sales because people want to buy what they offer.

Apple makes no effort in the desktop market and then points to the low numbers to justify their not making an effort there.

Have to disagree. This phenomenon is hardly limited to Apple. Desktops have been shrinking as a %age of sales of PC's for years and will pass unit leadership to portables next year. The domestic server market growth is anemic. Laptop/notebook and world server are the only real growth areas. Desktops aren't going away, but they're not where a focused growth company that recently removed "computer" from its name is going.....

From: eTForecasts - Worldwide PC Forecast

Note: I tried to get the figures to line up properly but the forum editor and what it displays seem to have different ideas about that. Sorry.

Table 1.2 U.S. and Worldwide PC Market Segments
Unit Sales 1990 1995 2000 2006 2007 2013
U.S. PC Server Sales (#M) 0.04 0.51 2.5 4.0 4.2 5.3
U.S. Desktop PC Sales (#M) 8.4 16.8 33.1 36.6 35.7 26.4
U.S. Mobile PC Sales (#M) 1.1 4.1 10.4 26.5 30.1 52.5
Worldwide PC Server Sales (#M) 0.06 0.94 5.5 12.1 13.6 20.3
Worldwide Desktop PC Sales (#M) 21.7 47.1 96.2 140.5 149.2 143.3
Worldwide Mobile PC Sales (#M) 2.4 10.0 27.9 80.0 96.1 204.8

The desktop PC segment will remain the largest PC segment through 2010. Both PC servers and mobile PCs are taking market share from the desktop PC segment. Mobile PCs include all laptop, notebook and other mobile PCs. The emerging tablet PCs and wearable PCs are also included in the mobile PC segment. PDAs and Smartphones are excluded. Worldwide mobile PC unit sales will top desktop PC sales in 2011 or possibly earlier

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[melgross]

Originally Posted by Dr Millmoss

True, I haven't got anything in my portfolio that has recovered nearly as well as AAPL. But I'm going to stick by my policy and not try to predict future price. So much can happen between now and a year from now. I never heard anyone predict that AAPL would fall by 60% in just a few months (even as profits grew), but it sure as hell happened. The current ratio may be more backed up by dollars than it was before, but this is not necessarily a sign of sanity. In so many ways, the stock market is not a rational place. That's one thing I've learned the hard way.

The market isn't totally irrational either, or what happens would be totally random,

I've done pretty well over the years in spotting trends in the one industry I know really well, and I don't stray too far from it.