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After Q2 decline, Apple's iPad shipments expected to double in Q3 2011

post #1 of 19
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Apple is believed to be ramping up shipments of the iPad 2, especially the white model, to reach 100 percent sequential growth in the company's third quarter of fiscal 2011, according to one analyst.

The Cupertino, Calif., company surprised Wall Street on Wednesday with the news that sales of the iPad had declined from 7.33 million units in the first quarter of fiscal 2011 to 4.69 million in the second quarter. In spite of the decline in iPad shipments, Apple still posted impressive numbers with a 95 percent jump in profits since last year and the largest year over year quarterly revenue growth in the company's history.

On average, Wall Street analysts had expected Apple to report a more modest decline to 6.2 million iPads. Analyst Ming-Chi Kuo of Concord Securities predicted a relatively accurate sequential decline to 4.6 million iPad shipments in a Product Shipment Outlook report sent to AppleInsider earlier this week.

Kuo cited the transition from the first-generation iPad to the iPad 2 as the primary reason for the decline. Apple Chief Operating Officer Tim Cook admitted on Wednesday that product transitions are "never simple," noting that the company had drawn down 570,000 original iPad units and added 170,000 new iPad 2s into the channel at the end of the March quarter.

Cook admitted that the iPad currently has "the mother of all backlogs," but reassured investors that he was confident in Apple's ability to produce a "very large number of iPads" in the June quarter.

"I'm extremely pleased with the progress of the manufacturing ramp," said Cook, adding that Apple plans to release the iPad 2 in 13 more countries next week. Apple had previously announced intentions to launch the device in Hong Kong, Korea and Singapore by the end of April.

According to Kuo, iPad 2 shipments will rise "by a big margin" in the third quarter of fiscal 2011, "jumping over 100% sequentially." Kuo also claims that the white iPad 2 appears to be more popular than the black model. The white version accounts for 60 to 65 percent of iPad 2 shipments, his report noted.

Kuo estimates that iPad competitors will also ramp up shipments in the June quarter. Android tablet shipments will be 2.5 million to 3 million units in the quarter, with Acer shipping the most at 30 to 40 percent. Meanwhile, the shipment forecast for Research in Motion's BlackBerry PlayBook is "not bad" and is expected to reach 2.5 million units in the second quarter of 2011.

Despite the iPad's rivals being off to a "good start," Kuo warned that competitors will need to watch "sell-through and return rate closely," given that tablet shipments may not convert to actual sales.

For example, the Samsung Galaxy Tab, one of the first tablets shipped to compete with the iPad, reportedly has a 16 percent return rate, compared to Apple's 2 percent rate for the iPad. Samsung boasted earlier this year that it had shipped 2 million units to inventory channels, while conceding that actual sales to consumers did not occur as fast as expected.

J.P. Morgan analyst has predicted that the iPad 2 could cause a "bubble burst" for rival tablet makers, who may have inflated build plans in order to secure components, but could fail to sell the device if tablet shoppers continue to overwhelmingly choose the iPad.

iPhone shipments

Kuo asserted that CDMA iPhone shipments had become "a bit sluggish," citing more smartphone choices for Verizon subscribers as a probable cause. U.S. iPhone sales jumped up an impressive 155 percent from last year, with Verizon's share of the lot expected to stand at roughly 3 million.

According to the analyst's report, the GSM version of the iPhone 4 accounted for 70 to 80 percent of Apple's total iPhone shipments in the second quarter of fiscal 2011. Kuo cautioned that iPhone shipments may flatten for the June quarter, due to competition from Android phones from HTC, Samsung and Motorola, impact from the Japan earthquake on the supply chain, and preparation for the move to the iPhone 5 in the third quarter of 2011.

iPod shipments

Sales of the iPod continued to decline in the March quarter, dropping 17 percent year over year to 9.02 million units, though Apple said the sales figures were "ahead of [its] expectations." The company revealed Wednesday that sales of the iPod touch comprised more than half of the total sales of iPods last quarter.

Kuo believes that iPod sales fell due to "weak demand in slack season of consumer electronics" and the fact that the iPhone receives first priority in components share between the iPhone and the iPod touch. He also speculates that iPod shipments will be flat in the June quarter for the same reasons.

Regarding the second-generation Apple TV, Kuo estimates that Apple has shipped a total of 2 million units, with 820,000 shipped in the March quarter alone.
post #2 of 19
Too Little Too Late...

by the time you get a shipment notification for iPad 2, it's time for iPad 3.
post #3 of 19
Quote:
Originally Posted by Unknownz View Post

Too Little Too Late...

by the time you get a shipment notification for iPad 2, it's time for iPad 3.

I doubt you bought one, Tekstud.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #4 of 19
Quote:
Originally Posted by SpamSandwich View Post

I doubt you bought one, Tekstud.

I did enjoy the banter with Tekstud. With each new incarnation, a little is lost however. Maybe Tekstud's telomeres (http://en.wikipedia.org/wiki/Telomere) are getting shorter too quickly (I am sure mine are)!

Apple's supply chain is only as strong as its weakest link (pun apology) and none of those links will keep idle capacity sitting around for long. Where are the millions of alternate systems?

All the best.
Where are we on the curve? We'll know once it goes asymptotic!
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Where are we on the curve? We'll know once it goes asymptotic!
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post #5 of 19
I don't see Apple being affected any more than anyone else due to supply chain problems.
post #6 of 19
The static revenue is a bit strange, as iPads are expected to double in sales Q-Q. iPhones are expected to take a hit, I suppose.
I wanted dsadsa bit it was taken.
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I wanted dsadsa bit it was taken.
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post #7 of 19
As anyone who has been to a movie theater will say, black is better than white. Your eye focuses on the screen when the edges are black. White distracts. Which is why the push for white puzzles me.
post #8 of 19
Why is everyone getting worked up that sales dropped from 7.3 M in the Christmas quarter to 4.7 M the first (calendar) quarter? Duh....


On top of that, Apple announced iPad 2 in Feb and didn't deliver until March. And even then, deliveries were severely constrained. Anyone who expected north of 6 million units this quarter was insane. If they only shipped 7.3 M for Christmas - with supply largely caught up with demand, who in their right mind thought that they'd ship 6.2 M the next quarter - even without a new product introduction?


Analysts are idiots.
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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post #9 of 19
Quote:
Originally Posted by ChrisNH View Post

As anyone who has been to a movie theater will say, black is better than white. Your eye focuses on the screen when the edges are black. White distracts. Which is why the push for white puzzles me.

Yep, They should also have a neutral gray option for graphic artists.


Quote:
Originally Posted by jragosta View Post

Why is everyone getting worked up that sales dropped from 7.3 M in the Christmas quarter to 4.7 M the first (calendar) quarter? Duh....


On top of that, Apple announced iPad 2 in Feb and didn't deliver until March. And even then, deliveries were severely constrained. Anyone who expected north of 6 million units this quarter was insane. If they only shipped 7.3 M for Christmas - with supply largely caught up with demand, who in their right mind thought that they'd ship 6.2 M the next quarter - even without a new product introduction?


Analysts are idiots.

Yes, I agree ... the delay in purchases leading up to the release of the second version followed by a stock shortage easily explains the dip.
Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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post #10 of 19
"Meanwhile, the shipment forecast for Research in Motion's BlackBerry PlayBook is "not bad" and is expected to reach 2.5 million units in the second quarter of 2011."

This prediction by Kuo seems way, way, way too high.

Please update the AppleInsider app to function in landscape mode.

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Please update the AppleInsider app to function in landscape mode.

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post #11 of 19
Quote:
Originally Posted by jd_in_sb View Post

"Meanwhile, the shipment forecast for Research in Motion's BlackBerry PlayBook is "not bad" and is expected to reach 2.5 million units in the second quarter of 2011."

This prediction by Kuo seems way, way, way too high.

We have now TWO euphemism for disheartening sales number: "not bad", and "quite smooth".

That 2.5 million shipped number is very easy to achieve. Galaxy pad also had 2 million shipped without anything to show for it.
post #12 of 19
Quote:
Originally Posted by xsu View Post

We have now TWO euphemism for disheartening sales number: "not bad", and "quite smooth".

That 2.5 million shipped number is very easy to achieve. Galaxy pad also had 2 million shipped without anything to show for it.

Yeah maybe 2.5 million PlayBooks shipped into the channel, maybe 200,000 sell through. That's "not bad".
post #13 of 19
Quote:
Originally Posted by xsu View Post

We have now TWO euphemism for disheartening sales number: "not bad", and "quite smooth".

That 2.5 million shipped number is very easy to achieve. Galaxy pad also had 2 million shipped without anything to show for it.

You are confusing sales with channel. This is reports of sales by Verizon. Not Channel ( phones sent to Verizon by Apple). The latter is higher.
I wanted dsadsa bit it was taken.
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I wanted dsadsa bit it was taken.
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post #14 of 19
Lots of analyst are predicting Apple will sell 40 millions ipad in 2011. Unless Apple start making them way faster I dont see that happening. In order to acheive 40 millions in 2011 they need to make around 4 millions per month for the rest of the year.
post #15 of 19
As of today you cannot find one iPad2 at any retailer in metro Portland, anywhere....
post #16 of 19
Idiotic Apple Analyst Comment #8,362:

"Kuo believes that iPod sales fell due to "weak demand in slack season of consumer electronics" and the fact that the iPhone receives first priority in components share between the iPhone and the iPod touch."

So, that means there was an iPod touch shortage? Don't remember that one.
post #17 of 19
Quote:
Originally Posted by jbpdx View Post

As of today you cannot find one iPad2 at any retailer in metro Portland, anywhere....

1. 300millions Americans vs 6 billions the rest of the world. So, the world doesn't not only revolve around the US, and particularly Portland.

2. You go to apple store to test the products and it's best to order it online when very limited stocks will reach the store daily/weekly. That's the reason fewer stocks could be seen reaching the stores since apple has shipped millions pieces who purchased the ipads online.

Therefore, the conclusion derived from the stock availability at stores will be mostly distorted.
post #18 of 19
just cancelled my iPad order with Apple Store...
post #19 of 19
Quote:
Originally Posted by beinghuman View Post

1. 300millions Americans vs 6 billions the rest of the world. So, the world doesn't not only revolve around the US, and particularly Portland.

Ive never understood why someone would make that argument. Unless a product can be marketed to the worlds entire population its a pointless strawman.

The fact remains that Apple is a American* company that first sells its wares to Americans, has more store and 3rd-party retailers than any other country, and sells more of its wares to Americans yielding a far higher revenue and profit than any other country. China will very likely take that crown, but not today.


* Yes, we all know that America also refers to continents and subcontinents but only one country has the name America in it, hence this common usage which isnt easily confused with an reference to all peoples in the Western hemisphere.
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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