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Overseas growth driving Mac sales as US consumers hold out for new models

post #1 of 20
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Apple is expected to report more than 22 percent growth in Mac shipments when it announces its quarterly earnings next week, driven by growth overseas, which will compensate for dampened sales in the U.S. in June.

That's according to Barclays Capital analyst Ben Reitzes, who reiterated the firm's Overweight rating on shares of Apple in a note to investors on Tuesday. As noted by Barron's, the analyst predicts Apple will post $5.44 in earnings per share, below the Street consensus of $5.73.

Reitzes said Mac shipments to the U.S. market in June could be "somewhat muted" as reports of an upcoming refresh to the MacBook Air have led consumers to hold off on new Mac purchases.

However, in spite of lightened Mac demand in the States, Reitzes believes the company will still reach his projections of 22.5 percent Mac growth because of faster growth overseas. According to him, Apple averaged 15 percent shipment growth in April and May.

In the March quarter, Apple reported 28 percent growth in Mac sales for a total of 3.76 million units. In the Asia Pacific region, Mac sales grew 76 percent year over year.

"The growth in the Mac has been enormous in Asia," the company's Chief Operating Officer Tim Cook said in April. "This is many multiples of the growth that that region is seeing for the market."

Also on Tuesday, analyst Brian White with Ticonderoga Securities increased his iPhone and iPad predictions for the third fiscal quarter. After a recent trip to Asia, White sees Apple selling 8.5 million iPads and 17.53 million iPhones, up from projections of 8.22 million and 15.85 million respectively.

Another analyst spoke up earlier Tuesday, recommending Apple stock and describing it as having "plenty of gas in the tank." J.P. Morgan's Mark Moskowitz views recent improvements to the iPad 2 supply as a sign that the company has strong upside potential that should outperform "low expectations and macroeconomic issues" among other technology stocks.
post #2 of 20
I saw the first news of updated Airs less than a month after I bought mine back in February. I've been telling my girlfriend to wait until Lion to buy her new Air.

The question is, how well does such news of a refresh permeate the non-blog-junkie crowd? Can that really explain the drop in sales?
post #3 of 20
Quote:
Originally Posted by brutus009 View Post

I saw the first news of updated Airs less than a month after I bought mine back in February. I've been telling my girlfriend to wait until Lion to buy her new Air.

The question is, how well does such news of a refresh permeate the non-blog-junkie crowd? Can that really explain the drop in sales?

A while back I looked at Amazon to see how high the white MacBook was on the sales ranking. The top rated review for it was pretty much a warning to people that a refresh was imminent and they shouldn't buy.

I think people are getting wiser to Apple's refresh cycle. The phone refresh cycle has clued them into it if nothing else.
post #4 of 20
Quote:
Originally Posted by brutus009 View Post

I saw the first news of updated Airs less than a month after I bought mine back in February. I've been telling my girlfriend to wait until Lion to buy her new Air.

The question is, how well does such news of a refresh permeate the non-blog-junkie crowd? Can that really explain the drop in sales?

The only people who are holding off buying new Macs because of Lion or new HW are those who follow tech site such as AI. And they are minority.
post #5 of 20
Quote:
Originally Posted by NasserAE View Post

The only people who are holding off buying new Macs because of Lion or new HW are those who follow tech site such as AI. And they are minority.

Oh come now, I'm sure there are many AI readers who are white!
No Matte == No Sale :-(
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No Matte == No Sale :-(
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post #6 of 20
Rumor sites making groundless promises about future backlit MacBook Airs don't help

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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post #7 of 20
Although people (mostly correctly) associate Apple with innovation - much more than nearly any other company, and they have revolutionized computing and telephony to huge impact - not only in those fields but on how we live our lives - this has basically been a result of product vision, industrial design and sweating enough of the details of their products to the point of obsession rather than basic inventions involving hardware. Even their own CPU's are based on ARM reference designs and they actually invent and manufacture few physical objects, let alone the parts that go into them (chips, screens, etc.).

And they haven't been totally immune to borrowing a few notions (some would say many more than a few, but this is off my main point, and in some ways is a semantic argument).

The bulk of the rest of their success is actually in how they've brilliantly operated as a business. Marketing, advertising, strategic relationships (and even strategic disputes), margin and inventory management, the now iconic retail chain, the whole iTunes sales enterprise and much more. Largely, these are things that are applicable to many businesses (which is why the history and practices of Apple, Inc will be in the curriculum of business schools for many decades to come).

And the true inventions they are responsible for are primarily in the field of UI and software in general. I certainly wouldn't mess too much with a model which has had such amazing results as a business and produced so many products that in so many ways are a joy to use and a boon to now hundreds of millions of folk (and billions of people if you count all the derivative products from other companies).

However, if I could do a bit of fine-tuning, it would be in R&D allocation and refresh cycles. Apple reportedly invests about 2.5% of total revenue in this activity - less than a third of what other tech companies do. This certainly helps their healthy margins and ROC and one can certainly argue that that carefully targeted 2.5% has accomplished much more than MS's reported 7.5% (altho' IBM established its long hegemony and then achieved its comeback largely through its historically high and continuing R&D efforts, many in basic science).

My point is simply that if that percentage had been nudged up by not too much, first a lot of small old niggles could have better and sooner resolved (long-term issues with the Finder and some minor particular dialog box dead-ends come first to mind - many of these have been highlighted in articles and comments here over the years).

But second and more importantly, products like Apple TV could have been further along their evolution and growth path, the Mac Pro in particular (and other models) could have had more minor refreshes in between major new iterations (adding Thunderbolt amounts to a major iteration for the purposes of what I'm saying here, e.g.) - all of which I feel could have led to more incremental sales which would have more than covered the efforts to do so, although I grant that Apple has its reasons for keeping its SKU's and parts bins under control in terms of providing service, repairs and support.

Anyway, there's another 2 cents in the opinion bucket. And meanwhile Apple keeps rolling along with the promise of much more success to come.

An iPhone, a Leatherman and thou...  ...life is complete.

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An iPhone, a Leatherman and thou...  ...life is complete.

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post #8 of 20
Quote:
Originally Posted by brutus009 View Post

I saw the first news of updated Airs less than a month after I bought mine back in February. I've been telling my girlfriend to wait until Lion to buy her new Air.

I've also been waiting and telling everyone I know to wait.

However, Apple has only themselves to blame. They have the new machines done, they are holding off on releasing them...presumably to wait for OS X Lion release.

I'm particularly interesting in seeing a Mac Mini refresh and finding out whether the specs will be worthwhile.
post #9 of 20
Quote:
Originally Posted by AppleInsider View Post

As noted by Barron's, the analyst predicts Apple will post $5.44 in earnings per share, below the Street consensus of $5.73.

I'm curious (but not enough to try to find out right this moment) as to when the last time Apple didn't meet "street consensus" - for as long as I can remember Apple has been criticized for "sandbagging" because they always outperform their projections...

which also struck me as odd and ironic - but that's another thread...
post #10 of 20
Quote:
Originally Posted by brutus009 View Post

The question is, how well does such news of a refresh permeate the non-blog-junkie crowd? Can that really explain the drop in sales?

I think so. Heck, before my mom bought her current iMac, it's the first thing she asked me - how long has it been out and when is it due to be replaced? I had to pull up stuff like the macosrumors buying guide to assure her she was getting a good deal and buying at the right time. That I was also visiting at the time and could also set it up for her made it the right time too

Bottom line - people in general are very aware of things like lifecycle...
post #11 of 20
I love monday morning quarterbacking....

Quote:
Originally Posted by bigpics View Post

My point is simply that if that percentage had been nudged up by not too much, first a lot of small old niggles could have better and sooner resolved (long-term issues with the Finder and some minor particular dialog box dead-ends come first to mind - many of these have been highlighted in articles and comments here over the years).

Why are you assuming that simply tossing more money around can fix something like this?

And why do you assume that Apple agree's with the articles and comments that those are problems that need fixing?

Quote:
But second and more importantly, products like Apple TV could have been further along their evolution and growth path

In what way? The main problem with the AppleTV isn't the hardware or software, but content - the video content producers are even more brain dead than the music people were!

You want to know what will push the AppleTV further along than anything else? Final Cut Pro X.

Quote:
the Mac Pro in particular (and other models) could have had more minor refreshes in between major new iterations (adding Thunderbolt amounts to a major iteration for the purposes of what I'm saying here, e.g.)

Huh? Apple relies 100% on Intel for the Mac Pro bumps. Indeed, Apple often releases chipsets ahead of their general availability to the rest of industry. What more, exactly, do you want them to do?!?

And just because laptops have thunderbolt doesn't mean it's Apple being lazy and not offering it on the Mac Pro for some arbitrary reason - the two products use entirely different processor families and chipsets.

Quote:
all of which I feel could have led to more incremental sales

Well duh. It could have also led to decreased sales too - too frequent of refreshes and people just keep "holding on" for the next version that is right around the corner.

Quote:
which would have more than covered the efforts to do so

Really? You think you can run Apple more efficiently than they are now? They are widely recognized as being one of the most well run companies on the planet (and have the market cap to prove it).

Quote:
Anyway, there's another 2 cents in the opinion bucket. And meanwhile Apple keeps rolling along with the promise of much more success to come.

None of what you postulate as "tweaks" are minor or tweaks - they are pretty fundamental fiddling with formulas that are currently PRODUCING dramatic, positive results.

Personally I'd rather see the xMac (two slot minitower) than any of your tweaks - but I'm not holding my breath for any of it...
post #12 of 20
They might as well face it. Consumers all over the globe highly desire Apple products. Anyone think consumers would line up for an HP or Dell device Highly unlikely. Why should Apple be directly affected by the economy if people keep buying their products. Yes, Wall Street will find a way to lower Apple's stock undoubtedly similar to the way they did back in 2008, but Apple will continue to bring in revenue and profits even in this weak economy.
post #13 of 20
Quote:
Originally Posted by DocNo42 View Post

I love monday morning quarterbacking....



Why are you assuming that simply tossing more money around can fix something like this?

And why do you assume that Apple agree's with the articles and comments that those are problems that need fixing?



In what way? The main problem with the AppleTV isn't the hardware or software, but content - the video content producers are even more brain dead than the music people were!

You want to know what will push the AppleTV further along than anything else? Final Cut Pro X.



Huh? Apple relies 100% on Intel for the Mac Pro bumps. Indeed, Apple often releases chipsets ahead of their general availability to the rest of industry. What more, exactly, do you want them to do?!?

And just because laptops have thunderbolt doesn't mean it's Apple being lazy and not offering it on the Mac Pro for some arbitrary reason - the two products use entirely different processor families and chipsets.



Well duh. It could have also led to decreased sales too - too frequent of refreshes and people just keep "holding on" for the next version that is right around the corner.



Really? You think you can run Apple more efficiently than they are now? They are widely recognized as being one of the most well run companies on the planet (and have the market cap to prove it).



None of what you postulate as "tweaks" are minor or tweaks - they are pretty fundamental fiddling with formulas that are currently PRODUCING dramatic, positive results.

Personally I'd rather see the xMac (two slot minitower) than any of your tweaks - but I'm not holding my breath for any of it...

There are so many people that think they can run Apple much better than Steve Jobs. Like standing on a ladder and adding another rung. If these people think they can do better than Apple, they should be passing their fantastic ideas on to Cisco or Dell or Acer to turn them into revenue powerhouses. When a company like Apple is standing far above most tech companies and somebody says Apple is slacking off, that's just pure arrogance. These non-business people think it's so easy to run a company despite the fact that so many businesses fail. I sure wish I could run even a small business as well as what Apple is doing. I guess some of these business geniuses figure that Apple turned into the wealthiest tech company simply by luck. It looks to me like Apple has had a steady and calculated climb over the last seven years or so. That's not overnight success by any means.
post #14 of 20
Quote:
Originally Posted by DocNo42 View Post

I love monday morning quarterbacking....

Why are you assuming that simply tossing more money around can fix something like this?

And why do you assume that Apple agree's with the articles and comments that those are problems that need fixing?

In what way? The main problem with the AppleTV isn't the hardware or software, but content - the video content producers are even more brain dead than the music people were!

You want to know what will push the AppleTV further along than anything else? Final Cut Pro X.

Huh? Apple relies 100% on Intel for the Mac Pro bumps. Indeed, Apple often releases chipsets ahead of their general availability to the rest of industry. What more, exactly, do you want them to do?!?

And just because laptops have thunderbolt doesn't mean it's Apple being lazy and not offering it on the Mac Pro for some arbitrary reason - the two products use entirely different processor families and chipsets.

Well duh. It could have also led to decreased sales too - too frequent of refreshes and people just keep "holding on" for the next version that is right around the corner.


Really? You think you can run Apple more efficiently than they are now? They are widely recognized as being one of the most well run companies on the planet (and have the market cap to prove it).

None of what you postulate as "tweaks" are minor or tweaks - they are pretty fundamental fiddling with formulas that are currently PRODUCING dramatic, positive results.

Personally I'd rather see the xMac (two slot minitower) than any of your tweaks - but I'm not holding my breath for any of it...

Actually I thought I gave Apple plenty of props and respect in the post (including specific acknowledgement of their being "one of the most well run companies on the planet") and know they can do the amazing things they do better than I could run even a lemonade stand. Not to mention that Steve ignored my personal letter of application in 1984 shortly after the Mac debuted - not surprising since I had no skills truly useful to Apple then (or now), and the letter was written on a Commodore 64 with a terrible dot matrix printer.

Plus you misread me in several places. e.g., I specifically identified adding TB to the Pro as part of the next likely major update and NOT one of the tweaks I was suggesting. Which do quietly happen sometimes anyway (changing the solid state storage on the MBA, e.g.). Nor did I say in any way, shape or form that Apple lives by the reportage or commentary on Apple sites.

If that were so, based on the clamor of acolytes, you would've had your mythical mid-range Mac years and years ago, but you don't, and we agree, actually, that you very, very likely won't. But that's because there's no business case for their investing in a stagnant growth area when there are richer opportunities in pioneering new, untapped - or relatively untapped - markets. Only a third of US cell users have a smart phone yet. Likely less than one in 20 TV owners has any form of TV add-on box such as Apple TV, Roku, Slingbox, et al.

So I stand by the thrust of my post - which is that there have been and are a few things at Apple which could have gotten - and benefited from - a little more love without materially effecting - and maybe helping (maybe, yes) the bottom line. One example - apps on Apple TV. They're doubtless coming - or something like them is coming on some device (or pathway from a different HW source) akin to the ATV will be coming, but my sense is that targeted engineering (not "throwing money" - which I clearly identified as what companies like MS do) could have advanced the arrival of such.

There's also the "disruptive force" argument - Apple's been it - but it is possible that that crown could be seized from them in one or more areas where they stand tallest today by hungry, capable companies willing to forgo stock price runup or EPS or the size of their cash cache for pouring more into trying (and possibly succeeding at) coming up with the next "insanely great thing." Apple can't rest on being Apple as they have been - there's more pressure than ever on them to keep re-inventing themselves at a good pace.

Again, I'm not in the boardroom - just an aging nerd in a forum full of other would be whatevers - but it's not blasphemy to conjecture that there are times when at least small decisions on the bottom line vs. a bit more investment have fallen on the BL side when they could've led to happier outcomes if they'd fallen on the "let's add this now" side.

PS: despite the howls, I think we agree that the new FCP is going to be one of those disruptive forces once it gets its sea legs - however, again, perhaps many of the howls were predictable - and Apple has acknowledged (almost as HP has about its underwhelming tablet release) that missing bits will be forthcoming shortly - so a case where a bit more polishing grease could have led to a more complete release at the release date, or a later release date without the irritants.

In any case, by fine tuning I meant very fine tuning. Thanks for the reaction though.

An iPhone, a Leatherman and thou...  ...life is complete.

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An iPhone, a Leatherman and thou...  ...life is complete.

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post #15 of 20
I just bought a new iMac. I've been planning to buy one since 2009, but couldn't afford to the day my G5 died and I've been making excuses ever since. Sandy Bridge plus Thunderbolt plus the impending death of Rosetta made me take the plunge. Now I have the last Mac ever made that still runs Snow Leopard and I can transition to Lion at my own pace.

The general public simply isn't aware of Apple rumours so I cannot believe rumours are dampening sales. I think the American public is still pessimistic about the future and scared to spend beyond their means when things are so uncertain.
post #16 of 20
Quote:
Originally Posted by DocNo42 View Post

I'm curious (but not enough to try to find out right this moment) as to when the last time Apple didn't meet "street consensus" - for as long as I can remember Apple has been criticized for "sandbagging" because they always outperform their projections...

which also struck me as odd and ironic - but that's another thread...

Most companies, not just Apple, rarely fail to beat the street on earnings. They are consistently conservative projections. Investors know this, which is why not beating consensus by a substantial margin is considered to be a disappointment. Under is a disaster.
Please don't be insane.
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Please don't be insane.
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post #17 of 20
This is good news! Not the hold out, but that overseas (i e non US sales) drives a growth. Most people in these forums still have APPLE as a US company and starts all evaluations based on US market indicators. But there is so much more to do for APPLE if (WHEN!!!) they go more and more global. They have done great so far but their market share and brand recognition is lower outside US.

The world is a sea to drink from and they have only just started with a sip!
post #18 of 20
No one I know is aware of them.
Perhaps I live in a bubble, but very time I go the Apple Store near me, it is filled with parents and kids. Especially now "just before" college. They come in and ask the kids what they want, talk to someone for a short time and then walk out with a MacBook Pro, a printer, MS Office and any number of other things.
They might pick up an iPhone while they are there despite the fact that a new one is on the way in a few months.

If sales have dropped, it is for some other reason, not because everyone is aware of Apple's product cycles.
post #19 of 20
Quote:
Originally Posted by tumme-totte View Post

This is good news! Not the hold out, but that overseas (i e non US sales) drives a growth. Most people in these forums still have APPLE as a US company and starts all evaluations based on US market indicators. But there is so much more to do for APPLE if (WHEN!!!) they go more and more global. They have done great so far but their market share and brand recognition is lower outside US.

The world is a sea to drink from and they have only just started with a sip!

You are pretty much correct but I'd say Apple are gulping at those overseas markets these days, not sipping ... which means Apple's growth potential is still massive.
From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
"Google doesn't sell you anything, they just sell you!"
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From Apple ][ - to new Mac Pro I've used them all.
Long on AAPL so biased
"Google doesn't sell you anything, they just sell you!"
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post #20 of 20
Quote:
Originally Posted by AppleInsider View Post

Reitzes said Mac shipments to the U.S. market in June could be "somewhat muted" as reports of an upcoming refresh to the MacBook Air have led consumers to hold off on new Mac purchases.

It's funny - last year, before the launch of the iPhone 4, people were claiming that advance knowledge of new products didn't hurt Apple. This was used as rationalization for the criminals who were stealing / receiving stolen property and all the anti-Apple crowd who insisted that there was nothing wrong with it.

Now, advance information on new products is seen to hurt Apple.
"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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