Apple now building 2M iPads per month to meet demand
Apple has doubled its monthly output capacity of the iPad and is now manufacturing 2 million per month to meet strong consumer demand, but the company reportedly would like to go even further and produce 3 million every month very soon.
Analyst Katy Huberty with Morgan Stanley indicated that iPad builds recently increased to 2 million per month, up from the previous number of just 1 million a month. Apple allegedly indicated to its suppliers that it would like to produce 3 million a month starting in the fourth calendar quarter of 2010.
It's likely not coincidental that less than a week ago, iPad shipping times for new orders from apple.com improved to 24 hours. For months, customers had to wait an estimated 7 to 10 days, as Apple was surprised by strong demand for the device when it launched in April.
Officials with the company admitted they were initially caught off guard by the demand for the iPad after it launched, and they were unsure when they would be able to satisfy that demand. Chief Operating Officer Tim Cook noted that the iPad is not taking a typical early adopter curve, and already has a "very big" market.
"We want to take full advantage of it, and so we are investing enormous time and resources in increasing our capability in getting iPad out to as many people as we can," Cook said in July.
Despite strong demand, Huberty reiterated that the iPad has not cannibalized sales of Macs. She noted that U.S. Mac sales are tracking up 20 to 25 percent year over year, and have been accelerating in recent weeks.
In June, it was estimated that Apple was producing a total of 1.2 million iPads per month. That was up from 800,000-900,000 units in May, 700,000 units in April, 470,000 units in March, and 300,000 in February. At the time, it was projected that Apple could produce as many as 2.5 million per month in time for the 2010 holidays.
Analyst Katy Huberty with Morgan Stanley indicated that iPad builds recently increased to 2 million per month, up from the previous number of just 1 million a month. Apple allegedly indicated to its suppliers that it would like to produce 3 million a month starting in the fourth calendar quarter of 2010.
It's likely not coincidental that less than a week ago, iPad shipping times for new orders from apple.com improved to 24 hours. For months, customers had to wait an estimated 7 to 10 days, as Apple was surprised by strong demand for the device when it launched in April.
Officials with the company admitted they were initially caught off guard by the demand for the iPad after it launched, and they were unsure when they would be able to satisfy that demand. Chief Operating Officer Tim Cook noted that the iPad is not taking a typical early adopter curve, and already has a "very big" market.
"We want to take full advantage of it, and so we are investing enormous time and resources in increasing our capability in getting iPad out to as many people as we can," Cook said in July.
Despite strong demand, Huberty reiterated that the iPad has not cannibalized sales of Macs. She noted that U.S. Mac sales are tracking up 20 to 25 percent year over year, and have been accelerating in recent weeks.
In June, it was estimated that Apple was producing a total of 1.2 million iPads per month. That was up from 800,000-900,000 units in May, 700,000 units in April, 470,000 units in March, and 300,000 in February. At the time, it was projected that Apple could produce as many as 2.5 million per month in time for the 2010 holidays.
Comments
Go Apple... Go, go, go...
I wonder where the analysts, experts (and trolls) who claimed this device would struggle to sell more than two million units in its first year are now?
No camera, no flash, no {insert port, service or function here}...
That's the theory at least, but wait for the posts below where people continue to complain about the device, tell us why we shouldn't like it, shouldn't buy it, list what it can't do and why we're being forced to buy it in the millions.
Apple are doomed!®
If Apple was making one million a month but selling two million, wouldn't there be a 30 day delay after one month, a 60 day delay after two months, etc.?
It wouldn't be possible to stay consistently 7 days behind if they always sold more than they made.
After OS 4.2 is released, it will be open season for the holiday gifts and corporate demands for the iPad. When large corporations go into full deployment next year, massive production capacity will be needed.
Go Apple... Go, go, go...
2011 should prove to be amazing as no doubt more sophisticated iOS products appear (I suspect the dual OS X / iOS iMac is a real R&D project).
Hmmm it doesn't quite make sense to me.
If Apple was making one million a month but selling two million, wouldn't there be a 30 day delay after one month, a 60 day delay after two months, etc.?
It wouldn't be possible to stay consistently 7 days behind if they always sold more than they made.
Seems obvious to me the ramp up exceeded demand sufficiently to catch up and now, hopefully, should stay roughly equal as demand grows.
All this, and without a camera no less. I can't help believing that IF a camera is ever added it will be a distinct model line. Pretty sure that the camera is unwelcome in many enterprise settings.
I wondered this but has the iPhone been kept out of enterprise due to the camera? Of course Apple could offer a with and without version of the iPad.
I guess I will wait until it gets facetime, for home use will be a hit with the family, will need to add the keyboard/dock! and will be enough to everyone check mails, browse, games and etc in a cheaper way than buying the cheapest iMac.
Hmmm it doesn't quite make sense to me.
If Apple was making one million a month but selling two million, wouldn't there be a 30 day delay after one month, a 60 day delay after two months, etc.?
It wouldn't be possible to stay consistently 7 days behind if they always sold more than they made.
Who said apple were selling two million a month, and how do you know how big the stockpiles were before launch day? They weren't constantly 7 days behind, the shipping dates are always estimates and I guess a week covered them if the delay was anything up to that...
So say 4 million April through July. Then 4 million August September. And 9 million October through December for a total of 17 million deployed by January. That's a pretty strong lead for any competitors to try and overcome.
Yup and also incontrovertible proof that Apple got this right, that the average consumer wants it and that people are happy with it (haven't seen any media screams about failures or issues with this...)
That it's getting an upgrade with new features and functionality free of charge, is great - the icing on the cake for current users.
Although there will be still be people posting complaints here. It doesn't have 8 gigs of RAM and you can't run photoshop on it, no flash, no camera (and on and on and on!).
The iPad plus the update in November sounds pretty sick, still not available in my country on the authorized dealer but on the street is available but darn expensive ($750 cheapest one)
I guess I will wait until it gets facetime, for home use will be a hit with the family, will need to add the keyboard/dock! and will be enough to everyone check mails, browse, games and etc in a cheaper way than buying the cheapest iMac.
I think you might be disappointed if you buy the device as a family computer - no multiple user accounts would leave no email privacy, and the iOS mail app quickly becomes cluttered with multiple accounts. This is designed primarily as a personal device, and I'm not sure it would work as a family computer - I'd LOVE to be proved wrong, but think twice before making your purchase for this reason. Good luck!
Who said apple were selling two million a month, and how do you know how big the stockpiles were before launch day? They weren't constantly 7 days behind, the shipping dates are always estimates and I guess a week covered them if the delay was anything up to that...
The story did: "Analyst Katy Huberty with Morgan Stanley indicated that iPad builds recently increased to 2 million per month, up from the previous number of just 1 million a month. Apple allegedly indicated to its suppliers that it would like to produce 3 million a month starting in the fourth calendar quarter of 2010." This is assuming that Apple builds approximately the same number they sell.
Don't everyone get in a giant huff over this, it's just something I've never understood. For example, if you call to get cable or something installed, it's always a week out. If it's consistently one week out for years, why can't they just put some overtime in and catch up? If it's a case of more orders every day than they can handle, wouldn't it just get worse and worse?
I think digitalclips hit it - it's not a flat one million and then suddenly two million. They ramped up. So the story is misleading.
...but let's not kid ourselves either: Resistance is absolutely futile. I just hope Steve Jobs is in good health, so that he can truly enjoy his success.
If nothing else, they seem to be the default prize for most competitions these days.
In theory this should quieten the doubters who claimed that the reason for the 'catch up' was a decline in demand.
The same "doubters" called Jobs an outright liar in a previous thread when he questioned Android activations so why would they be quieted over this. In the "doubter" mind Apple is an illusion, a phantom, an invention that simply doesn't exist.
Hmmm it doesn't quite make sense to me.
If Apple was making one million a month but selling two million, wouldn't there be a 30 day delay after one month, a 60 day delay after two months, etc.?
It wouldn't be possible to stay consistently 7 days behind if they always sold more than they made.
It's good to read with that sort of skepticism and questioning. But I think in this case the answer's sort of simple: production doesn't run merrily along at 1 million per, and then suddenly jump overnight to 2 per. Instead, productivity increases gradually as more components are ordered and acquired and production lines and workers are added. Think of a gradually ascending line graph representing production (as a similar graph reps demand/sales). Overlaid, they converge. Sometimes prod'n will exceed sales in prep for expected future demand; other times sales will surpass prod'n and there may be waiting periods while (increasing) prod'n catches up. But both are increasing gradually. The 1 per-to- 2 per jump in sales isn't an overnight event either.
The amazing thing to me is that apple anticipates new product demand so well.