Apple sells 270,000 iPhones in the first two days

[AppleInsider]

Apple Inc. said Wednesday that it sold 270,000 iPhones in the final 30 hours of its fiscal third quarter -- the first time the gadgets were available for purchase in the United States.

The Cupertino-based electronics maker offers the handset in two configurations, a 4GB model for $499 and an 8GB model for $599. However, it did not specify how many of each model were sold, and instead reported a combined total of the two.

Many of the iPhones sold on June 29th and 30th were not activated by customers until sometime thereafter, as Apple's sales total from the two days far exceeds early iPhone activation totals reported by wireless carrier AT&T.

AT&T said earlier in the week that it activated only 146,000 of the Apple handsets during the first two days, but added that more than 40 percent of those activations were to customers switching their service from a rival carrier.

In addition to first weekend iPhone sales, Apple also announced Wednesday that third quarter profits rose 73 percent to $818 million, or $.92 per diluted share, on sales of $5.41 billion.

During the quarter, the company shipped 1,764,000 Macintosh computers, representing 33 percent growth over the year-ago quarter, and 9,815,000 iPods, representing 21 percent growth.

Given its plan to defer iPhone accounting and revenues over a 24 month period, Apple said sales of the first 270,000 iPhone contributed only $5 million in revenue to its quarterly total.

[ View this article at AppleInsider.com ]

[josephwinters]

Slam dunk Apple!

[lfe2211]

Originally Posted by josephwinters

Slam dunk Apple!

Facial!

[Matthew Yohe]

Originally Posted by AppleInsider

Apple Inc. said Wednesday that it sold 270,000 iPhones in the final 30 hours of its fiscal third quarter -- the first time the gadgets were available for purchase in the United States.

The Cupertino-based electronics maker offers the handset in two configurations, a 4GB model for $499 and an 8GB model for $599. However, it did not specify how many of each model were sold, and instead reported a combined total of the two.

Many of the iPhones sold on June 29th and 30th were not activated by customers until sometime thereafter, as Apple's sales total from the two days far exceeds early iPhone activation totals reported by wireless carrier AT&T.

AT&T said earlier in the week that it activated only 146,000 of the Apple handsets during the first two days, but added that more than 40 percent of those activations were to customers switching their service from a rival carrier.

In addition to first weekend iPhone sales, Apple also announced Wednesday that third quarter profits rose 73 percent to $818 million, or $.92 per diluted share, on sales of $5.41 billion.

During the quarter, the company shipped 1,764,000 Macintosh computers, representing 33 percent growth over the year-ago quarter, and 9,815,000 iPods, representing 21 percent growth.

Given its plan to defer iPhone accounting and revenues over a 24 month period, Apple said sales of the first 270,000 iPhone contributed only $5 million in revenue to its quarterly total.

[ View this article at AppleInsider.com ]

EEK! 270K is iPhones AND Apple/Thirdparty accessories!

[anantksundaram]

I am simply stunned by this company's ability to consistently execute strategy.

I don't mean to get all choked-up or to exaggerate, but b-school bookshelves are going to be filled with case studies extolling Apple as one of the first truly great companies of the 21st century. Its shares are certainly not cheap, and the stock price volatility is going to be here to stay for a while and not or the faint-hearted, but I honestly believe that there is a lot of value yet to created for its shareholders.

[Matthew Yohe]

Apple apologized for the activation issues and that AT&T has corrected these issues

[MacTel]

270,000 iPhones in 30 hours is awesome! AT&T just couldn't keep up on the activations.

[Matthew Yohe]

On track for selling iPhone in Europe Q4

[BuzDots]

Originally Posted by AppleInsider

Apple Inc. said Wednesday that it sold 270,000 iPhones in the final 30 hours of its fiscal third quarter -- the first time the gadgets were available for purchase in the United States.

9000 per friggin hour!

suck on that one Zune



(yes, yes, I know there is no correlation of product - just masterful execution of everything else)

[anantksundaram]

Originally Posted by Matthew Yohe

EEK! 270K is iPhones AND Apple/Thirdparty accessories!

Even if true, who cares.

I'd rather go with -- and I am really quite pleased by -- SJ's forecast of a million sold by the end of the first full quarter of sales.

[webmail]

This is fantastic news, overall the way apple is positioning the reported earnings from the iPhone, as well as the steady rise in Macs sold will contribute to steady rising stock instead of the typical daily highs and lows that Apple has had for years.

As someone who owns 10,000 shares (8 years+) of stock. I'm really enjoying the fact that lately Apple stock is become less "jumpy" and is being set up in a way to be a steady rise, instead of the quick $5+ or $-3 drops.

Great on the earnings Apple, you blew past estimates by .20cents!!!

More Mac adoption is fantastic news too. More Mac users means it will bleed into users who become "Apple Lifetime Members"

[Abster2core]

Originally Posted by Matthew Yohe

EEK! 270K is iPhones AND Apple/Thirdparty accessories!

What is this "Apple/Thirdparty accessories" you refer to?

[Thomaspin]

Sorry to rain on the parade, but AAPL's data sheet states the 270,000 'Consists of iPhones and Apple-branded and third-party iPhone accessories' - see footnote (6) on their Unaudited Summary Data.

So if each iPhone buyer also bought an iPhone case, say, the iPhone unit sales number comes in at 135,000, etc.

[freeny]

Stock up to $146 in after hours trading...

[aaarrrgggh]

Originally Posted by Thomaspin

Sorry to rain on the parade, but AAPL's data sheet states the 270,000 'Consists of iPhones and Apple-branded and third-party iPhone accessories' - see footnote (6) on their Unaudited Summary Data.

So if each iPhone buyer also bought an iPhone case, say, the iPhone unit sales number comes in at 135,000, etc.

On the conference call, CFO indicated that it was iPhone units. Curious how many were returned the next day when people realized they weren't going to get rich off E-Bay...

[Dr. X]

Never Mind, I got the answer.

[anantksundaram]

Originally Posted by Thomaspin

Sorry to rain on the parade, but AAPL's data sheet states the 270,000 'Consists of iPhones and Apple-branded and third-party iPhone accessories' - see footnote (6) on their Unaudited Summary Data.

So if each iPhone buyer also bought an iPhone case, say, the iPhone unit sales number comes in at 135,000, etc.

I read elsewhere that Oppenheimer clarified that they meant 270,000 phones. It is simply how they released the "segment" results. (I have not actually checked it out first-hand, however).

[nagromme]

I other words, 150 iPhones per minute.

So... either AT&T is fibbing about activation delays affecting only 2% of the weekend's buyers... or else a LOT of people bought an iPhone, took it home, and left it in the box to watch reruns on TV all weekend.

EDIT: OK, OK. I get it. Online purchases must be delivered before they can be activated.

[Thomaspin]

Originally Posted by aaarrrgggh

On the conference call, CFO indicated that it was iPhone units. Curious how many were returned the next day when people realized they weren't going to get rich off E-Bay...

He went on to state that "....the majority of the revenue contribution of $5mm was from accessories". Confusing as he earlier stated that accessory revenues would also be amortizd, which does not sync. Also, with a $550 iPhone and a $30-40 case or whatever, that is not possible, so it's confused.

[Thomaspin]

BTW, AAPL's data sheet appears here:

http://images.apple.com/pr/pdf/q307data_sum.pdf

[dreamraj]

6:08 pm

In PM activity: AAPL around $150.

Buyers many and sellers few.

Tomorrow the stock will be up big(ger) because number of buyers will increase. A few analysts have already come out with praise and will up their price targets soon. Also note that Apple said their "new product pipeline is very strong." With new iPods, iMacs and Leopard coming, this stock is headed for the sky. Not to mention lower cost iPhone Nano that Apple is rumored to be working on.

For those of you who've been holding back on AAPL - Still NOT LATE to hop on the money train!!

[lfe2211]

Originally Posted by Thomaspin

Sorry to rain on the parade, but AAPL's data sheet states the 270,000 'Consists of iPhones and Apple-branded and third-party iPhone accessories' - see footnote (6) on their Unaudited Summary Data.

So if each iPhone buyer also bought an iPhone case, say, the iPhone unit sales number comes in at 135,000, etc.

Did you listen to the conference call? 270,000 iPhones were sold in 30 hours.

[physguy]

Originally Posted by lfe2211

Did you listen to the conference call? 270,000 iPhones were sold in 30 hours.

If you actually think about it there is absolutely NO inconsistency between 149,000 activations and 270,000 sales.

There a number of purchase conditions that would not allow instantaneous activation.

1) Purchase of second unit for friend. I was in line at the apple store on Friday and almost everyone was buying TWO phones. Most that I talked to in line were buying for a friend, not another family member. In my case my friend didn't come by until Sunday to pick it up.

2) The activation debacle - AT&T will minimize this any way they can so the number they quote is likely ones that AT&T were responsible for. Again, my example serves. I didn't get activation until Sunday but it wasn't AT&T fault. T-Mobile wouldn't release my number. So since AT&T reports 40% switchers this could be a lot of units.

3) People buying late Saturday may likely not activate until Sunday (That's not that long) or there activation, while not instantaneous, was only 5-8 hours. AT&T would not necessarily consider this a delay (they should in principle).

Item 1 and 2 alone could easily account for the difference. You can't be sure either way and, IMO, both arguments are very plausible so we just don't know other than its NOT inconsistent.

[SpinDrift]

Originally Posted by BuzDots

[B][SIZE="5"]
suck on that one Zune

Have Micro$haft sold any of those things yet?

[steviet02]

Originally Posted by physguy

If you actually think about it there is absolutely NO inconsistency between 149,000 activations and 270,000 sales.

There a number of purchase conditions that would not allow instantaneous activation.

1) Purchase of second unit for friend. I was in line at the apple store on Friday and almost everyone was buying TWO phones. Most that I talked to in line were buying for a friend, not another family member. In my case my friend didn't come by until Sunday to pick it up.

2) The activation debacle - AT&T will minimize this any way they can so the number they quote is likely ones that AT&T were responsible for. Again, my example serves. I didn't get activation until Sunday but it wasn't AT&T fault. T-Mobile wouldn't release my number. So since AT&T reports 40% switchers this could be a lot of units.

3) People buying late Saturday may likely not activate until Sunday (That's not that long) or there activation, while not instantaneous, was only 5-8 hours. AT&T would not necessarily consider this a delay (they should in principle).

Item 1 and 2 alone could easily account for the difference. You can't be sure either way and, IMO, both arguments are very plausible so we just don't know other than its NOT inconsistent.

They were also counting what was in transit, to their retail stores and AT&T stores. So they didn't really 'sell' 270k until probably the 4th day. It doesn't matter anyway, the initial numbers are somewhat irrelevant. There's that many fan boys that would buy it no matter what, lets see how it sustains.

[steviet02]

Originally Posted by lfe2211

Did you listen to the conference call? 270,000 iPhones were sold in 30 hours.

Listening to a conference call and what is actually on paper are two different things. Read the data sheet for the link he provided.

[anantksundaram]

Originally Posted by steviet02

Listening to a conference call and what is actually on paper are two different things. Read the data sheet for the link he provided.

Groan.

[steviet02]

Originally Posted by anantksundaram

Groan.

Is that supposed to be a meaningful post? You can put more thought into it than that can't you?

[physguy]

Originally Posted by steviet02

Listening to a conference call and what is actually on paper are two different things. Read the data sheet for the link he provided.

I did. Its not clear and the CFO clarified this during Q&A on the call. They sold 270,000 units.

Originally Posted by steviet02

They were also counting what was in transit, to their retail stores and AT&T stores. So they didn't really 'sell' 270k until probably the 4th day. It doesn't matter anyway, the initial numbers are somewhat irrelevant. There's that many fan boys that would buy it no matter what, lets see how it sustains.

Where did you get this tidbit. Its certainly not on the data sheet, nor is it what was said in the conference call. Its also contradictory to Apple's previous practices.

[steviet02]

Originally Posted by physguy

I did. Its not clear and the CFO clarified this during Q&A on the call. They sold 270,000 units.



Where did you get this tidbit. Its certainly not on the data sheet, nor is it what was said in the conference call. Its also contradictory to Apple's previous practices.

It was in response to an analysts question, I believe it was Tim Cook that responded. Also if you listen to his opening when he spoke of the number of phones sold he noted that it was phones sold to the retail stores and at&t stores. I'm trying to find the exact spot in the quicktime where the question came in. If you go back and listen to the analysts questions section you should be able to find it.

[ARW3]

Originally Posted by steviet02

They were also counting what was in transit, to their retail stores and AT&T stores.

Umm, how should I say this? Oh yeah, 'Wrong.'

[steviet02]

Originally Posted by physguy

I did. Its not clear and the CFO clarified this during Q&A on the call. They sold 270,000 units.



Where did you get this tidbit. Its certainly not on the data sheet, nor is it what was said in the conference call. Its also contradictory to Apple's previous practices.

It was almost right in the middle a guy named Tony Sacamagi (sp?) asked the question, it occurs at 28 minutes into the conference.

[steviet02]

Originally Posted by ARW3

Umm, how should I say this? Oh yeah, 'Wrong.'

Speaking before listening to the conference apparently.

[Neil Anderson]

Steve said Apple hopes to sell their millionth iPhone by the end of its first full quarter of sales. Didn't it take Apple seven quarters to sell its millionth iPod? I'd say, "Get on. This money train is leaving the station."

[anantksundaram]

Originally Posted by steviet02

Is that supposed to be a meaningful post? You can put more thought into it than that can't you?

Actually, I gave it all the thought it deserved.

But since you asked: Oppenheimer did specifically clarify it. Combined with the surmise on my part that Apple's segment classification could be just overly broad (after all, it is booking a non-material $5 million) and given how careful Apple tends to be (or rather, had better be in making a statement to that effect), it is more than likely that I am -- and others are -- right about something in the range of 270,000 being iPhone sales. It is possible that it is slightly lower, but I would venture a guess that it would not be materially so.

[lfe2211]

Steviet02,

What exactly are you trying to say in your posts?

[physguy]

Originally Posted by steviet02

It was in response to an analysts question, I believe it was Tim Cook that responded. Also if you listen to his opening when he spoke of the number of phones sold he noted that it was phones sold to the retail stores and at&t stores. I'm trying to find the exact spot in the quicktime where the question came in. If you go back and listen to the analysts questions section you should be able to find it.

1) If true this would be highly improper accounting to the extent that its totally out of character for official Apple pronouncements. Selling to oneself (the retail stores) and claiming sales is fraudulent.

2) Without taking the time to re-listen (I just don't have the time) I believe what was said was 'sales through retail and at&t stores' not to. He was likely excluding on-line as they should not be included until shipped, which couldn't have happened in this 30 hour time-frame.

[SpamSandwich]

Little linky

Investors were pleased with Apple's results, sending the company's shares up $12.89, or more than 9%, to $150.15 in after-hours trading

Hopefully this translates into $150 by tomorrow's market opening.

[anantksundaram]

Originally Posted by SpamSandwich

Little linky

Hopefully this translates into $150 by tomorrow's market opening.

Interesting linky. But, this comment, by another seemingly clueless analyst, grated:

"By any normal company's standards, sales of the iPhone in its first two days were brisk," said Charles Smulders, PC analyst with Gartner Inc. "If there is any sense of disappointment, then over-inflated expectations driven by Apple's marketing machine are to blame."

"Driven by Apple's marketing machine?!" Or by clueless analysts like himself?

[lfe2211]

Originally Posted by anantksundaram

Interesting linky. But, this comment, by another seemingly clueless analyst, grated:

"By any normal company's standards, sales of the iPhone in its first two days were brisk," said Charles Smulders, PC analyst with Gartner Inc. "If there is any sense of disappointment, then over-inflated expectations driven by Apple's marketing machine are to blame."

"Driven by Apple's marketing machine?!" Or by clueless analysts like himself?

Gartner is a thinly veiled MSFT stooge and MarketWatch is on my don't read list--John Dvorak and Hank "I'm always wrong" Greenberg work for them. Nuff said.