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iPad sales cannibalizing Macs, but record sales offset problem

post #1 of 21
Thread Starter 
Apple's chief executive Tim Cook admitted that iPad sales have likely eaten up some sales of Macs, but noted record new levels of Macs sold globally and added that a "materially larger number are buying iPads over [generic] PCs."

Cook's comments to analysts participating in the company's quarterly earnings conference call for fiscal Q4 2011 addressed sales of 4.89 million Macs, representing growth of 26 percent over Mac sales in the year ago quarter and setting a new quarterly record for sales of Macs.

While noting that some portion of the 11 million iPads sold in the quarter (a 166 percent increase in sales over the year ago quarter) have clearly replaced sales of some significantly more expensive Macs, Cook added that the iPad's growth is coming primarily at the expense of PCs.

Apple is "overwhelmingly coming out very well on that cannibalization," Cooks said. "With cannibalization like this, I hope it continues."

Tim Cook delivers the State of the Mac address in Cupertino in October 2008.

Apple's chief financial officer Peter Oppenheimer had earlier noted that Mac sales grew particularly fast in the company's Asia Pacific segment, but added that Mac growth had occured everywhere.

Oppenheimer also pointed out that 74 percent of Mac sales are now portables, but added that Apple had also experienced record sales of desktops in the quarter, primarily from sales of new iMacs.

Big in Japan

Cook also noted that in Japan, quarterly revenue performance over the year ago quarter had been expected to take a major hit due to the fact that last year, Apple had enjoyed a very successful iPhone 4 launch, while this year's iPhone 4S wasn't launched until after the September quarter had ended.

iPhone sales in Japan are also a larger percentage of Apple's sales, given that the nation has largely shifted from conventional PCs to mobiles almost a generation ahead of other regions.

However, Mac sales are strong and growing even in that market, with Apple reporting 48 percent growth in Japan's Mac sales for the quarter "in a [PC] market barely growing at all," Cook said. Sales of new Macs largely balanced out the delayed launch of this year's new iPhone in Japan.
post #2 of 21
Tim Cook is off to a good start.
post #3 of 21
iPhones eat iPod sales. iPads eat MacBook sales.

But it's better to cannibalize your own sales than let someone else do it.

That's a lesson that DEC, Compaq, and many, many others never learned.
post #4 of 21
Quote:
Originally Posted by ahmlco View Post


But it's better to cannibalize your own sales than let someone else do it.

I came here to post the same thing!
post #5 of 21
Quote:
Originally Posted by ahmlco View Post

iPhones eat iPod sales. iPads eat MacBook sales.

But it's better to cannibalize your own sales than let someone else do it.

That's a lesson that DEC, Compaq, and many, many others never learned.

You're absolutely right.

It's especially better if you are Apple, and you manage to maintain consistently high margins across their entire product range. Apple are cannibalizing one high margin product with another one - not many businesses have done that over the years.
post #6 of 21
Quote:
Originally Posted by zindako View Post

Tim Cook is off to a good start.

to bad that Apples results are 10% under the Streets expectations and over 20% under the bloggers expectations.

Shares down 10% in after hour trading.

Wall Street is insane.
Profit up 54% and the shares tank.

PE 15 with 81 billion in cash. AAPL. The most undervalued company on the stock exchange.
post #7 of 21
Quote:
Originally Posted by shompa View Post

PE 15 with 81 billion in cash. AAPL. The most undervalued company on the stock exchange.

this!
post #8 of 21
Quote:
Originally Posted by shompa View Post

to bad that Apples results are 10% under the Streets expectations and over 20% under the bloggers expectations.

Shares down 10% in after hour trading.

Wall Street is insane.
Profit up 54% and the shares tank.

PE 15 with 81 billion in cash. AAPL. The most undervalued company on the stock exchange.

The expectations in the financial world is the reason they say the economy sucks. Wall Street wants and wants mo money all the time. Just imagine how crazy those hedge fund managers get when a company like Apple comes up short based on THEIR EXPECTATIONS.
Apple has 81 billion in the bank. That is the real money. Outside REAL MONEY, it is all bull****!
post #9 of 21
Looks to me like Apple is eating everyone else's lunch... and they're still hungry.

Proud AAPL stock owner.

 

GOA

 

Get the lowdown on the coming collapse:  http://www.cbo.gov/publication/45010

Reply

Proud AAPL stock owner.

 

GOA

 

Get the lowdown on the coming collapse:  http://www.cbo.gov/publication/45010

Reply
post #10 of 21
Quote:
Originally Posted by shompa View Post

to bad that Apples results are 10% under the Streets expectations and over 20% under the bloggers expectations.

Shares down 10% in after hour trading.

Wall Street is insane.
Profit up 54% and the shares tank.

PE 15 with 81 billion in cash. AAPL. The most undervalued company on the stock exchange.

You forgot - Apple's revenues were 10% ahead of Apple's guidance and EPS was about 40% over Apple's guidance.

So the analysts are upset that they listened to themselves rather than Apple?
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
Reply
post #11 of 21
Quote:
Originally Posted by ahmlco View Post

iPhones eat iPod sales. iPads eat MacBook sales.

But it's better to cannibalize your own sales than let someone else do it.

That's a lesson that DEC, Compaq, and many, many others never learned.

With that lesson learned, Apple can start selling midrange expandable Mac minitowers and not worry about cannibalizing iMacs.
post #12 of 21
When they next upgrade the desktop Macs, I'll be buying one. That ought to fix the worries...
post #13 of 21
I got a first generation iPad which I promptly replaced with the second generation, but I don't see myself getting an iPad again in the future after this one, I'll instead get a MacBook Air to replace both my iPad and MacBook Pro. The iPad is great and there was a time when I used it religiously but ever since I moved here my usage pattern changed and the iPad doesn't fit anymore. Now can we get a midrange expandable tower or at least an option for a dual socket Mac mini with Thunderbolt-dock GPU?

iPod nano 5th Gen 8GB Orange, iPad 3rd Gen WiFi 32GB White
MacBook Pro 15" Core i7 2.66GHz 8GB RAM 120GB Intel 320M
Mac mini Core 2 Duo 2.4GHz 8GB RAM, iPhone 5 32GB Black

Reply

iPod nano 5th Gen 8GB Orange, iPad 3rd Gen WiFi 32GB White
MacBook Pro 15" Core i7 2.66GHz 8GB RAM 120GB Intel 320M
Mac mini Core 2 Duo 2.4GHz 8GB RAM, iPhone 5 32GB Black

Reply
post #14 of 21
Quote:
Originally Posted by Haggar View Post

With that lesson learned, Apple can start selling midrange expandable Mac minitowers and not worry about cannibalizing iMacs.

It wouldn't be a cannibalized sell for me. I'll never buy an all in one. The mini doesn't offer expansion and the Mac Pro is overkill. I'm holding on to money that could be Apple's if it would only expand the desktop line up. And while I'm holding my money waiting for that mid range Mac I'm also not spending it on an iPod or iPhone, or iPad.

Come on Apple.
post #15 of 21
I'm not sure I agree with iPad taking away from "high-end" Mac sales. Mac unit sales are up sequentially by 26%, ASP is also up. People are buying iPad instead of iPod but are also buying Macs. Folks are buying more expensive Macs instead of buying cheap PCs. I'm not making it up, run the numbers.
post #16 of 21
Quote:
Originally Posted by ahmlco View Post

iPhones eat iPod sales. iPads eat MacBook sales.

But it's better to cannibalize your own sales than let someone else do it.

That's a lesson that DEC, Compaq, and many, many others never learned.

True that. Blockbuster didn't learn it either. They allowed their online DVDs by mail business to whither on the vine, out of fear that it's success would hurt their stores. As a consequence, Netflix came in and took all the business...
post #17 of 21
Quote:
Originally Posted by MacTac View Post

It wouldn't be a cannibalized sell for me. I'll never buy an all in one. The mini doesn't offer expansion and the Mac Pro is overkill.

Guess you're going to keep waiting, then, 'cause Apple is never going to do it.

Especially that Thunderbolt is here. Expansion is done by adding new functionality via a TB chain or Cinema Display monitor's ports, or via WiFi for speakers, printing, Time Capsule backups, and so on.

A box with extra slots and bays? Really?
post #18 of 21
Quote:
Originally Posted by ahmlco View Post

A box with extra slots and bays? Really?

Yes, really. Not all of us want the clutter of external devices. Some of us are interested in keeping things neat and orderly.
post #19 of 21
Quote:
Originally Posted by MacTac View Post

Yes, really. Not all of us want the clutter of external devices. Some of us are interested in keeping things neat and orderly.

the mini laptop cpu and low end video hold it back and Thunderbolt can't fix that.

Also only 2 laptop ram slots? should have 4 slots.
post #20 of 21
It really shouldn't be surprising. DIdn't Steve Jobs actually say long ago that if he was in charge of Apple (before his return) he'd milk the mac for all it was worth and get started on the next big thing? He pretty much did that.


Quote:
Originally Posted by ahmlco View Post

iPhones eat iPod sales. iPads eat MacBook sales.

But it's better to cannibalize your own sales than let someone else do it.

That's a lesson that DEC, Compaq, and many, many others never learned.

That was nicely stated.

Quote:
Originally Posted by shompa View Post

to bad that Apples results are 10% under the Streets expectations and over 20% under the bloggers expectations.

Shares down 10% in after hour trading.

Wall Street is insane.
Profit up 54% and the shares tank.

PE 15 with 81 billion in cash. AAPL. The most undervalued company on the stock exchange.

People are too panicked with their investments currently. The market is silly like that. The company has really strong fundamentals there, so it makes sense as a long term purchase.


Quote:
Originally Posted by maccherry View Post

The expectations in the financial world is the reason they say the economy sucks. Wall Street wants and wants mo money all the time. Just imagine how crazy those hedge fund managers get when a company like Apple comes up short based on THEIR EXPECTATIONS.
Apple has 81 billion in the bank. That is the real money. Outside REAL MONEY, it is all bull****!

Hedge funds "in their current form" are one of the most dysfunctional things in our economy right now.

Quote:
Originally Posted by MacTac View Post

It wouldn't be a cannibalized sell for me. I'll never buy an all in one. The mini doesn't offer expansion and the Mac Pro is overkill. I'm holding on to money that could be Apple's if it would only expand the desktop line up. And while I'm holding my money waiting for that mid range Mac I'm also not spending it on an iPod or iPhone, or iPad.

Come on Apple.

Bleh... the mac pro is just overpriced for a mediocre machine. The base model has the price of a higher end workstation without the features or hardware of one. I'd really enjoy a headless imac too but I don't see it happening. I find myself concerned about an imac's reliability factor if run hard for hours at a time. For me it's not just about speed but a stable machine.

Quote:
Originally Posted by Joe The Dragon View Post

the mini laptop cpu and low end video hold it back and Thunderbolt can't fix that.

Also only 2 laptop ram slots? should have 4 slots.

It seems to do ok in speed for what it has but I'm not a fan of laptop grade parts in a desktop form factor. They're too expensive relative to their performance. Even just extra room for ram would be a huge boost there as 8GB sticks still cost a fortune. This would definitely extend its usable life.

Quote:
Originally Posted by ahmlco View Post

Guess you're going to keep waiting, then, 'cause Apple is never going to do it.

Especially that Thunderbolt is here. Expansion is done by adding new functionality via a TB chain or Cinema Display monitor's ports, or via WiFi for speakers, printing, Time Capsule backups, and so on.

A box with extra slots and bays? Really?

While I agree with you they'll probably never do it, there are many better ways of bringing this about than what we currently see in the mac pro. If PCIe SSDs were cheaper that would be an awesome route assuming a functional lane setup for it. Thunderbolt is great for accessories that you want to share between a mac pro and your laptop depending on circumstances. Because of that I think it sucks that they haven't made it to the mac pro yet. I blame intel.
post #21 of 21
Quote:
Originally Posted by MacTac View Post

Yes, really. Not all of us want the clutter of external devices. Some of us are interested in keeping things neat and orderly.

That's why I mentioned the WiFi aspect. My printer is WiFi enabled, my computer's speakers that I use for music are connected to an AirPort, and my daily backups all go to a Time Capsule.

It's pretty hard to be more neat and orderly than by eliminating the rats nest of USB and audio cables streaming to and from your computer altogether...
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