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Notes of interest from Apple's Q2 2011 conference call - Page 2

post #41 of 68
Quote:
Originally Posted by Onhka View Post

That is not what he said. http://www.macworld.com/article/1593...ranscript.html

From that site:
iPhone sales were up over three times during the quarter, and in the first half [of the fiscal year] we did just slightly under $5 billion in greater China in revenue, which is about 10 percent of Apple, to put it in perspective. That makes more sense.
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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post #42 of 68
Quote:
Originally Posted by Gatorguy View Post

According to someone a few posts up Apple indicated they didn't expect the demand, thus they didn't have enough product. Disruptions in the supply chain weren't an issue.

That's still an odd comment IMO. . .

It's only odd if you fail to understand it .... which you obviously do.
See, in the record business, you can show someone your song, and they don’t copy it. In the tech business, you show somebody your idea, and they steal it. (Jimmy Iovine)
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See, in the record business, you can show someone your song, and they don’t copy it. In the tech business, you show somebody your idea, and they steal it. (Jimmy Iovine)
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post #43 of 68
Quote:
Originally Posted by peter236 View Post

When they say China sales of $5 billion is 10% of Apple, I don't quite get it. Their total sales is $24.67 billion for the quarter.

2 Quarters who combined totals are roughly $50 Billion in revenues, hence $5 Billion in this year is 10% of their total revenues.
post #44 of 68
Quote:
Originally Posted by Gatorguy View Post

That would be an odd statement. So did he go on to explain missing the consensus estimates on iPad sales if supply wasn't an issue?

Exactly!

As an Apple shareholder, I'm really getting tired of these supply issues. I'm not sure if Tim Cook is being way too careful about over-production or what, but if he continues like this it's going to bite Apple in the ass.

Apple is damn lucky that Motorola, RIM and Samsung have stumbled so badly with their tablets. If they hadn't you would have had tons of people flocking to them, the same as with the Android phones.

Tim, get your act together on supply!
post #45 of 68
Quote:
Originally Posted by macnyc View Post

As an Apple shareholder, I'm really getting tired of these supply issues. I'm not sure if Tim Cook is being way too careful about over-production or what, but if he continues like this it's going to bite Apple in the ass.

Have you seen the reports of Apple trying to secure more and more components from multiple suppliers, even paying billions up front for security of those components over other customers?

As an Apple shareholder, Im afraid of the day interest in Apple creates an overabundance of products for sale.
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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post #46 of 68
Quote:
Originally Posted by solipsism View Post

Have you seen the reports of Apple trying to secure more and more components from multiple suppliers, even paying billions up front for security of those components over other customers?

As an Apple shareholder, Im afraid of the day interest in Apple creates an overabundance of products for sale.

I'm worried about about what is happening today, not what might or might not happen in the future.
post #47 of 68
While we're all happy with the numbers, does anyone else think Apple is going to pull back on May 2nd? After all, the index funds are going to have to sell almost 50% of their holdings for this NASDAQ re-weighting. Are there really that many on the buy side at this price??
post #48 of 68
Quote:
Originally Posted by macnyc View Post

I'm worried about about what is happening today, not what might or might not happen in the future.

As a shareholder I worry about the future share value, nothing else.

Not that for every device it doesnt have to sell they miss out on the net profit, yet for every device they cant sell thats a loss of the manufacturing costs. Based on Apples profit margin it looks that 3 units they dont have to sell equals 1 unit they cant sell because they made too many.

As a shareholder why do you wish Apple to have more than they can sell?
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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post #49 of 68
Quote:
Originally Posted by solipsism View Post

As a shareholder I worry about the future share value, nothing else.

Not that for every device it doesnt have to sell they miss out on the net profit, yet for every device they cant sell thats a loss of the manufacturing costs. Based on Apples profit margin it looks that 3 units they dont have to sell equals 1 unit they cant sell because they made too many.

As a shareholder why do you wish Apple to have more than they can sell?

Wow, I'm not sure why you always feel like you have to play devil's advocate to my posts but if you are, at least get things straight.

The future value of the stock is directly affected by what is happening now, and what is happening now is a problem with supply. As I stated before, Apple is damn lucky everyone else has stumbled badly on the tablet front because otherwise people would have flocked to the other vendors because they can't buy an iPad.

Arguing about the loss of manufacturing costs from units they don't sell is ridiculous. Then they might as well not sell anything. Just think of all the money they'd save then!

Anyone in retail knows that not having inventory results in lost sales. That is Apple's problem not over-production, so why are you obsessed with a problem that Apple hasn't really had in the last 10 years? Which by the way was a problem that Tim Cook was brought in to solve (among other things).
post #50 of 68
Quote:
Originally Posted by macnyc View Post

Anyone in retail knows that not having inventory results in lost sales. That is Apple's problem not over-production, so why are you obsessed with a problem that Apple hasn't really had in the last 10 years? Which by the way was a problem that Tim Cook was brought in to solve (among other things).

You either have too much supply or too little. Don’t say they should produce exactly the number that is needed. The goal is to maximize profits. In a simplified scenario that actually means you don’t over or under produce, but in a complex scenario there are many issues with bulk components and manufacturing, and the reality that you will never sell exactly as many as you need.

You can’t create these products in a vacuum. Apple is doing volume and growth that no one else has achieved in CE. They have shipped almost 200M iOS-based devices since mid 2007. If their factories are at full tilt what do expect them to do besides get more manufacturing going? Do you know this takes time? Should Apple spend billions on a new plant just to make one more unit, 100 more units, 1000 more units pre day? That doesn’t even account for components supply. There are tipping points that make this viable and unviable. We don’t know if that isn’t a major issue, it could very well be constrained component supplier(s) and no option to add or replace them any time soon.

You mentioned that you’re getting tired of supply issues thus implying that Apple isn’t producing enough to meet demand. Obviously that is true, but where is the proof they can produce more? Where is the proof that they are losing more money than producing too many, which is the flipside of your statement.

Apple growth is great. Their revenue is great. Their profits are great. I see no slowing down at this point. I don’t care if there are some lines for the iPad right now, I do care that Apple is not faltering and the future of the company is upward. I’m a happy shareholder.
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
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post #51 of 68
Quote:
Originally Posted by Gatorguy View Post

Someone with Apple said that?? Good thing it wasn't video since he couldn't have said it with a straight face.

Stop with your passive-aggressive b-s.

Soon, there'll be one of two outcomes: you'll agree with the dominant point of view here or you'll leave in frustration, recognizing that many folks here know what they're talking about.

Either would be fine.
post #52 of 68
Quote:
Originally Posted by macnyc View Post

Exactly!

As an Apple shareholder, I'm really getting tired of these supply issues. I'm not sure if Tim Cook is being way too careful about over-production or what, but if he continues like this it's going to bite Apple in the ass.

Apple is damn lucky that Motorola, RIM and Samsung have stumbled so badly with their tablets. If they hadn't you would have had tons of people flocking to them, the same as with the Android phones.

Tim, get your act together on supply!

You can always sell and get out. You'll save yourself some bother going forward.
post #53 of 68
Quote:
Originally Posted by macnyc View Post

Wow, I'm not sure why you always feel like you have to play devil's advocate to my posts but if you are, at least get things straight.

The future value of the stock is directly affected by what is happening now, and what is happening now is a problem with supply. As I stated before, Apple is damn lucky everyone else has stumbled badly on the tablet front because otherwise people would have flocked to the other vendors because they can't buy an iPad.

Arguing about the loss of manufacturing costs from units they don't sell is ridiculous. Then they might as well not sell anything. Just think of all the money they'd save then!

Anyone in retail knows that not having inventory results in lost sales. That is Apple's problem not over-production, so why are you obsessed with a problem that Apple hasn't really had in the last 10 years? Which by the way was a problem that Tim Cook was brought in to solve (among other things).

Wow. You need to come up to speed on some basics, for a guy who says he owns shares.

Excess demand can be met more easily than excess supply sold. This, apart from the downward spirals the latter can create.
post #54 of 68
Quote:
Originally Posted by TheOtherGeoff View Post

The conf call alluded to the fact that numbers were low as they drained the iPad1 reserves and ramped up the iPad2s...

they also said that they still can't keep up with demand where they would like to (they'd like to have 4-8 weeks of inventory in the pipe... they have less than 4 now).

They sell everyone they are making... which means they underestimated demand, and are taking a hit on short term sales.

Better to underestimate than overestimate demand. You think the Android tablet or Playbook sellers are jumping for joy at their current sales?

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #55 of 68
Quote:
Originally Posted by anantksundaram View Post

Wow. You need to come up to speed on some basics, for a guy who says he owns shares.

Excess demand can be met more easily than excess supply sold. This, apart from the downward spirals the latter can create.

You didn't understand a thing I wrote so it's pointless for me to respond.
post #56 of 68
Quote:
Originally Posted by anantksundaram View Post

Stop with your passive-aggressive b-s.

Soon, there'll be one of two outcomes: you'll agree with the dominant point of view here or you'll leave in frustration, recognizing that many folks here know what they're talking about.

Either would be fine.

You're a bit on the grumpy side tonight.
melior diabolus quem scies
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melior diabolus quem scies
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post #57 of 68
Quote:
Originally Posted by OriginalMacRat View Post

Apple should buy T-Mobile.

And do what with it? T-Mobile was for sale for a reason. The company only has cell towers that are actually very valuable. Apple has no experience in this area so something of this magnitude might take years to develop and implement.
Apple had me at scrolling
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Apple had me at scrolling
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post #58 of 68
Quote:
Originally Posted by macnyc View Post

You didn't understand a thing I wrote so it's pointless for me to respond.

Actually, it is you that does not seem to have a very good idea of the key issues involved.

Here's a hint: Google the phrase 'Newsboy Problem.' You might learn a thing or two about optimal order quantities.

Unless you are convinced (or can convince us) that you know the demand function (and supply capabilities) for the iPad more than Apple does, you have no clue as to what you're hyperventilating about.
post #59 of 68
Quote:
Originally Posted by Gatorguy View Post

You're a bit on the grumpy side tonight.

Yeah, I LOL when I am grumpy.
post #60 of 68
Quote:
Originally Posted by macnyc View Post

You didn't understand a thing I wrote so it's pointless for me to respond.

The rest of us can all hope.....
post #61 of 68
Quote:
Originally Posted by stelligent View Post

No explanation of lower than expected iPad numbers?

RTF previous post

Quote:
Originally Posted by ssls6 View Post

The break down of the number between models 1 and 2 would be the most telling metric. Model 2 was only introduced March 11th. The announcement was a month earlier I believe on the Feb 20th. That, in my opinion, would cause you to lose a month of 1 Qtr sales alone.
post #62 of 68
Alex Gauna has proven to be a stock manipulator, who ought to be fined, jailed, and demoted for his incompetent, destructive, and baseless FUD.
post #63 of 68
Quote:
Originally Posted by macnyc View Post

I'm worried about about what is happening today, not what might or might not happen in the future.

When are you going to understand that Apple doesn't really give a rats-a** what the others do?

The very fact that they can not get enough components from multiple suppliers, paying in CASH I might add... does not leave any room for any other tablet manufacturer to produce any more than Apple does.

Meaning... even if the people DID want a different tablet, the component supply bottle-neck would be the same... or even worse. Since said product would have to be more expensive than the iPad, and the producer would have to sell the tablet at a loss to compete. I don't see too many producers taking that chance, because the "complete eco-system" does not exist for their OS of choice (yet?).

When even Apple, with their great planning and closed-loop system, fails to anticipate demand... the other guys are just doing a plain ol' crap-shoot. Can't see their shareholders letting them play that game too long!

Most important point of the entire earnings call: MASSIVE BACKLOG! And ya know what the majority of that is? The enterprise. I wouldn't be surprised to hear 20-25 million for that segment alone.

Which puts my prediction and a few others around here right on track:
***60 million 2011 (roughly 60/40 consumer/enterprise...possibly 50/50).

*** if Apple and the world's component suppliers can make that many.
Knowing what you are talking about would help you understand why you are so wrong. By "Realistic" - AI Forum Member
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Knowing what you are talking about would help you understand why you are so wrong. By "Realistic" - AI Forum Member
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post #64 of 68
Quote:
Originally Posted by solipsism View Post

You either have too much supply or too little. Dont say they should produce exactly the number that is needed. The goal is to maximize profits. In a simplified scenario that actually means you dont over or under produce, but in a complex scenario there are many issues with bulk components and manufacturing, and the reality that you will never sell exactly as many as you need.

You cant create these products in a vacuum. Apple is doing volume and growth that no one else has achieved in CE. They have shipped almost 200M iOS-based devices since mid 2007. If their factories are at full tilt what do expect them to do besides get more manufacturing going? Do you know this takes time? Should Apple spend billions on a new plant just to make one more unit, 100 more units, 1000 more units pre day? That doesnt even account for components supply. There are tipping points that make this viable and unviable. We dont know if that isnt a major issue, it could very well be constrained component supplier(s) and no option to add or replace them any time soon.

You mentioned that youre getting tired of supply issues thus implying that Apple isnt producing enough to meet demand. Obviously that is true, but where is the proof they can produce more? Where is the proof that they are losing more money than producing too many, which is the flipside of your statement.

Apple growth is great. Their revenue is great. Their profits are great. I see no slowing down at this point. I dont care if there are some lines for the iPad right now, I do care that Apple is not faltering and the future of the company is upward. Im a happy shareholder.

+++1000+++ Absolutely and well stated.... as always you eloquent b*****
Knowing what you are talking about would help you understand why you are so wrong. By "Realistic" - AI Forum Member
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Knowing what you are talking about would help you understand why you are so wrong. By "Realistic" - AI Forum Member
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post #65 of 68
Quote:
Originally Posted by AppleInsider View Post

Guidance of $23 billion is a 7 percent sequential decline, uncharacteristic for Apple.

Why is this?
post #66 of 68
Quote:
Originally Posted by peter236 View Post
When they say China sales of $5 billion is 10% of Apple, I don't quite get it. Their total sales is $24.67 billion for the quarter.

Quote:
Originally Posted by solipsism View Post

Good question. I didn’t get that either.

Edit: Opps..already answered above.
post #67 of 68
Quote:
Originally Posted by macnyc View Post

Exactly!

As an Apple shareholder, I'm really getting tired of these supply issues. I'm not sure if Tim Cook is being way too careful about over-production or what, but if he continues like this it's going to bite Apple in the ass.

Apple is damn lucky that Motorola, RIM and Samsung have stumbled so badly with their tablets. If they hadn't you would have had tons of people flocking to them, the same as with the Android phones.

Tim, get your act together on supply!

Tim is the very BEST Operations guy in the world! He is to logistics what Jobs is to product(s) vision and direction.

Tim actually addressed this during the CC when asked how production could go from 7M+ last quarter to less than 5 this quarter. His simple answer was something to the effect that multi-million production transitions are NON TRIVIAL with a delicate balancing act of product announcement, retooling, inventory draw-down and new product ramping.... a VERY difficult dance indeed.

He does this better than ANYONE and has for YEARS. He went on to say they DO have the manufacturing capabilities in place and are confident of achieving previous run rates and then some.

This is why they are NOT delaying any country roll-outs and, in fact, continue on a torrid expansion of distribution world wide.

I know of NO ONE I would rather have running my operations than TC....do you??

Bottom line, I predict 9+ million units sold in Q3.

BTW, did you notice that (just yesterday afternoon right before their earnings announcement) the lead time on new iPad2 orders from Apple's site fell to 1-2 weeks from 3-4.

So, do not worry grasshopper and let's hope TC stays with Apple for the rest of his career.

From http://www.macworld.com/article/1593...ranscript.html

Quote:
.....the iPad has the mother of all backlogs that we’re working very, very hard to get out to customers as quickly as we can.

Product transitions are never simple, and as you can probably appreciate, we are in a position that we have to call them for many, many weeks in advance, in terms of how many of the current product we want to produce and the dates at which we will announce the new product.

We drew the channel down on the original iPad by 570,000 units during the quarter, and we added at the end of the quarter 170,000 of the new iPad 2s, although most of that was in transit at the end of the quarter. And so the net reduction was 400,000 and so our sell through was above five million for the quarter. And again, this has to be planned quite a ways in the future.

Just to remind you, we sent out an invitation to the [iPad 2 launch] event toward the end of February, we had the event in early March, we placed the unit on sale in the United States on March 11, and our quarter ended about 2 weeks thereafter. So, there was some expectation of a new product, and we would have obviously factored that into our thinking about the product transition, as we planned the number of the original unit to build.

So I think the key point here is that I’m extremely pleased with the progress we’ve been making on the manufacturing ramp. We have gotten off to a materially better start and produced a lot more units than we did on the original ramp of the first iPad, and we’re so confident with our ability to supply that we’ve already put on 25 additional countries at the end of March, and we’ll be placing on 13 more next week, and we’ll do even more as we step through the quarter.

All emphasis is mine.
post #68 of 68
Doesn't seem that they mentioned how they did in their Music/Apps store.
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