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Apple's strong Q4 2010 guidance could be conservative

post #1 of 15
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Apple guided revenue for the September quarter 6 percent above consensus estimates, the highest differential over the Street in 17 years. However, that figure may still be conservative given current sales of Macs, new data shows.

In a research note to clients, Gene Munster of Piper Jaffray noted that Apple's guidance of $18 billion in revenue for the quarter "implies sequential growth of just 15% vs. 25% in the year-ago quarter," but in view of current Mac sales, the analyst said, "Apple's strong guidance may prove to be conservative."

Mac sales

The current quarter's Mac sales are tracking inline with Street consensus of 21 percent year over year growth, pointing toward sales of 3.7 million Macs. Munster cited NPD data showing domestic sales in July up 15 percent, and noted that international sales are growing even faster.

Early figures of the combined domestic and international growth in Mac sales point toward unit sales of 3.6 to 3.8 million Macs, representing growth of 18 to 24 percent, well above Apple's overall guidance of 15 percent growth.

iPod sales

Among iPod sales, NPD domestic data suggests unit sales of 9.5 to 10.5 million devices this quarter, in line with Street estimates of 10 million iPods. That range of sales suggested by early data indicates growth between -7 and +3 percent, compared to -1 percent a year ago and Street consensus of -2 percent growth compared to last year.

Munster wrote that new iPod products are expected in September, but that "it is difficult to gauge the impact these new models will have on sales late in the quarter.

"Additionally," the research note states, "international iPod sales are a larger mix than international Mac sales resulting in a slightly greater margin of error from domestic NPD data."

In the previous quarter, Apple noted growth of iPod touch sales up 48 percent year over year, despite overall flat sales for Apple's non-smartphone mobile devices in general.

"Killer" international growth

In its most recent quarterly earnings conference call, Apple chief operations officer Tim Cook stated, "The company's revenues in the Americas are growing over 40 percent, and so this is a huge number. It's not that we're talking about a low number, it's just that the international numbers are absolutely killer."

Cook cited growth of 144 percent in China, near double growth in Hong Kong and 71 percent growth in Mac unit sales in the Asia Pacific region in general. Revenues were up 160 percent due to new Mac sales.

Even in Spain, where the economy has been in the doldrums of recession, Cook noted 59% growth in Mac sales. Apple set a new record of 3.47 million Macs in the quarter ending in June, making Munster's current estimates of around 3.7 million Macs a new peak for the company.
post #2 of 15
The international growth is little weird. What are real numbers we're talking about. 100% growth can mean that last quarter Apple sold 1000 macbook pros and this quarter is 2000, which can still be very little.
Apple had me at scrolling
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Apple had me at scrolling
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post #3 of 15
Quote:
Originally Posted by AppleInsider View Post

Apple guided revenue for the September quarter 6 percent above consensus estimates, the highest differential over the Street in 17 years. However, that figure may still be conservative given current sales of Macs, new data shows.

I other news, the Sun still rises in the East, the Pope is still Catholic, and bears still sh!t in the woods...

   Apple develops an improved programming language.  Google copied Java.  Everything you need to know, right there.

 

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   Apple develops an improved programming language.  Google copied Java.  Everything you need to know, right there.

 

  MA497LL/A FB463LL/A MC572LL/A FC060LL/A MD481LL/A MD388LL/A ME344LL/A

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post #4 of 15
Look like Gene Munster has started reading Andy Zaky!
Please don't be insane.
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Please don't be insane.
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post #5 of 15
Quote:
Originally Posted by John.B View Post

I other news, the Sun still rises in the East, the Pope is still Catholic, and bears still sh!t in the woods...

... the bear is a Catholic?

.
"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
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"...The calm is on the water and part of us would linger by the shore, For ships are safe in harbor, but that's not what ships are for."
- Michael Lille -
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post #6 of 15
I go to/by a larger footprint apple store relatively frequently, and I have to admit, my non-scientific analysis, is that the number of iMacs and Macbooks walking out of that store is freaking amazing. (like one every 5 minutes).

And last week (mid week in the evening) the number of ipads sold per hour must be staggering (I was there for 10 minutes, and saw the sale of at least 5. Usually I feel a calm at the Apple Store... the last few times it feels more like Filene's Basement, the day they mark everything down 65.

As a stock holder, I'm smiling. As a customer, I'm doing more shopping online;-)
post #7 of 15
Quote:
Originally Posted by Dick Applebaum View Post

... the bear is a Catholic?

.

No, the Pope s**ts in the woods! A pig's ass in pork and a frog's anus is airtight! And on and on!
post #8 of 15
I was in southern Spain for 8 months in 2006, few people had even heard of Macs and fewer still ever seen one. In the town I was in (20,000) almost no one had even heard of iPod (even though Citibank in Sevilla was giving them away as a promo.)

So I believe that Spain could be seeing this kind of growth even during a deep recession. It kind of parallels the growth in the USA - in 2004.

We know where that brought us.
post #9 of 15
I remember reading Zaky saying that the Mac would grow Y-Y at around 30+%. Can somebody clarify these estimates? TIA.
post #10 of 15
Quote:
Originally Posted by iVlad View Post

The international growth is little weird. What are real numbers we're talking about. 100% growth can mean that last quarter Apple sold 1000 macbook pros and this quarter is 2000, which can still be very little.

They always give year-over-year growth. So it would be comparing the same quarter last year. These numbers would *really* be insane if they were quarter-over-quarter growth. To put it in perspective, more then half of Apple's sales are international sales and that percentage has been changing quite rapidly.
post #11 of 15
Quote:
Originally Posted by AjitMD View Post

I remember reading Zaky saying that the Mac would grow Y-Y at around 30+%. Can somebody clarify these estimates? TIA.

I'm pretty sure Apple has pretty consistently maintained about 50% year over year growth since at least 2005. I don't see the numbers in this article, but it sounds like about 60% year-over-year when you combine international and domestic right now. 30% sounds low, but maybe that is profit growth as Apple continues to lower margins and use more expensive manufacturing techniques.
post #12 of 15
Quote:
Originally Posted by iVlad View Post

... What are real numbers we're talking about. 100% growth can mean that last quarter Apple sold 1000 macbook pros and this quarter is 2000, which can still be very little.

I only bother to look at the big, chunky numbers and in the last few quarters we've finally seen the international sales numbers overtake domestic totals, for the very first time. I've been waiting for this literal tipping point and it bodes very well for the company as a whole. I read it as the rest of the world (which is a heck of a lot bigger than us), discovering Apple ... for real. And that is where the big time growth is going to come from.
post #13 of 15
I was just in the 3rd street santa monica store this afternoon, over an hour wait for an iphone4 (line was 30 deep when I got there and when I left). They claimed they received their biggest stock yet of iPhones that day.
The iphone line was cordoned off in the front corner, but the rest of the store was just as packed. ibooks, mac, and even ipods we flying off the shelf. There must have been over 20 cashiers calmly swiping credit cards. Just curious if ANY apple stores were dead Monday afternoon.
post #14 of 15
And let's not forget the release of the new Mac Pro. These will obviously sell quicker as any refreshed Mac, but since it has been the longest wait ever. According to MacRumors.com it hasn't been updated for more than 500 days. This should indicate a stronger sale than the usual refresh cycle.

Will that be of any significance? What do you guys think?

Cheers,
Philippe
"Fibonacci: As easy as 1, 1, 2, 3..."
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"Fibonacci: As easy as 1, 1, 2, 3..."
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post #15 of 15
Quote:
Originally Posted by PhilBoogie View Post

And let's not forget the release of the new Mac Pro. These will obviously sell quicker as any refreshed Mac, but since it has been the longest wait ever. According to MacRumors.com it hasn't been updated for more than 500 days. This should indicate a stronger sale than the usual refresh cycle.

Will that be of any significance? What do you guys think?

Cheers,
Philippe

Not a big difference in number of sales, as so few Mac Pros are sold, but they should be very profitable sales.
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