Net sales consist primarily of revenue from the sale of hardware, software, digital content and applications, peripherals, and service and support contracts. The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collection is probable. Product is considered delivered to the customer once it has been shipped and title and risk of loss have been transferred. For most of the Company’s product sales, these criteria are met at the time the product is shipped. For online sales to individuals, for some sales to education customers in the U.S., and for certain other sales, the Company defers revenue until the customer receives the product because the Company legally retains a portion of the risk of loss on these sales during transit. The Company recognizes revenue from the sale of hardware products (e.g., Macs, iPhones, iPads, iPods and peripherals), software bundled with hardware that is essential to the functionality of the hardware, and third-party digital content sold on the iTunes Store in accordance with general revenue recognition accounting guidance. The Company recognizes revenue in accordance with industry specific software accounting guidance for the following types of sales transactions: (i) standalone sales of software products, (ii) sales of software upgrades and (iii) sales of software bundled with hardware not essential to the functionality of the hardware.
Notice the part about transfer of title? That's a sale. RIMM just said that they shipped about 14.1 million phones this last quarter, but upon being asked, they admitted that they just sold a bit over 12 million.
Something like the iPad is so inexpensive at $500 -- that someone will give it away to get you to buy their product. The prize in the cereal box, if you will.
I don't know whether that's someone selling language courses, wine/gourmet food of the month, real estate courses, subscriptions to whatever, home security, college degrees, automotive repair, woodworking...
There is a resort in Key West FL (USA), Island House, that gives you a free iPad when you stay 7 or more nights (I assume to surf the internet on their wifi).
I am as pro Apple as they come but have held off on buying an iPad because I am waiting for some actually functionality. I feel there needs to be the ability to write and take notes on .ppts. I know there is a big push to go with the "human interface" but most people don't write with their finger, they use pens and pencils. Incorporating this sort of functionality would open it up to all the students, like myself, who refused to buy microsoft based products. I hope iPad2 has the ability to do something. If it does, I will buy 2 (one for my wife and one for me).
Notice the part about transfer of title? That's a sale. RIMM just said that they shipped about 14.1 million phones this last quarter, but upon being asked, they admitted that they just sold a bit over 12 million.
When Apple shipped their iphones to the carriers, they also transfer title. You can ask the Russian carriers who were holding the bag when they couldn't sell them.
I think you are on the right track, applebaum. If I had my guess, Jobs wants the ipad to be the cheap handle to the expensive razorblades. Or Kodak's Brownie, cheap camera means lots of repeat business in film and processing. The ipads like the Kodak Brownie or the Glillet disposable razor.
Jobs wants us to consume Software and Services on our Ipad 2. The money is not in the Ipad, its in its media consuming appetite.
Thats my guess.
Bingo. That is what the new Carolina Cloud is for. Its to support this base of media consuming iproduct. What a cash stream. And internationally applicable.
Yeah... it's gotta be something like that!
But I don't know if Apple wants to get in the Content business -- it would send a bad signal to other Content providers. Just as they don't get heavy into the app business, because it competes with the developers.
Here's what I want.
If I as a consumer of content , I look at what frustrates me the most -- I can't get the content I want, when i want on the devices I want it.
For live event content I understand I need to watch live; record live; or rent/purchase after the fact.
We pay ATT U-verse $180/mo for basic cable and Medium speed Internet. We Pay ATT Wireless $255/Mo for 5 phones (2 iPhones) and 1 iPad 3G. We pay NetFlix $19 month for streaming Movies and the occasional DVD. Red Box gets another $15/mo. And we've rented or purchased hundreds of LPs, VHS tapes, CDs and DVDs. Spend $50 a month with iTMS. Spend $50/month first run DVDs.
All that, over $500/mo (and all the time, space and equipment) and we still can't get what we want.
If Apple can negotiate/convince the Content Owners to allow demand or subscription streaming to any/all of my iDevices (including AppleTV.
If Apple can negotiate/convince my IP provider to assure acceptable streaming performance through to my router.
If Apple can negotiate/convince my wireless provider to assure acceptable streaming performance through to my iDevices,
If Apple can remove the burden/requirement for me me to manage and maintain a local media-library for all my purchases.
I would gladly pay Apple the $500/month to have Apple either deal with these entities or bypass them.
But they are in the content business. Itunes is # what? in music sales. The App store. The pending IMac applications store. Now working on books. Now working on TV, and movies.
I would bet you a beer, this is where the growth and direction Apple will go.
When Apple shipped their iphones to the carriers, they also transfer title. You can ask the Russian carriers who were holding the bag when they couldn't sell them.
Revenue from the sale of Blackberry devices is recognized when title is transferred to the customer and all significant contractual obligations that affect the customer's final acceptance have been fulfilled."
Revenue from the sale of Blackberry devices is recognized when title is transferred to the customer and all significant contractual obligations that affect the customer's final acceptance have been fulfilled."
Yes. And I said that THEY said that they shipped 14 million, but when asked, said that they sold about 12 million. With Apple, shipped and sold are the same thing.
Yes. And I said that THEY said that they shipped 14 million, but when asked, said that they sold about 12 million. With Apple, shipped and sold are the same thing.
Are you sure that you didn't mishear it --- they shipped 12 million in the previous quarter.
But they are in the content business. Itunes is # what? in music sales. The App store. The pending IMac applications store. Now working on books. Now working on TV, and movies.
I would bet you a beer, this is where the growth and direction Apple will go.
No!
Apple does not provide content!
Apple resells content owned by others!
Apple breaks even or makes minimal profit for iTunes Music Store and iTunes App Store.
These are used to sell Apple hardware -- same way as OS X, iLife, iWork FCE, FCS, etc.
Apple makes 35-45% gross margin on its hardware!
That's what business Apple is in.
The only thing I don't know about is iAd -- long term, Apple, like Google, could make most of its money from iAd! I hope not!
If one thinks of global demand, six million units per month is not that far-fetched.
there are some pretty convincing rumors that 2.0 will support both CDMA and GSM making it a world device. That could help to push the global numbers that high
Quote:
Originally Posted by Blah64
My fear is that Apple, in their need to keep the # of SKUs down, may ignore this problem.
Or perhaps they won't.
The 16 GB wifi only that we have now is good for a lot of school needs. So maybe they will leave that model as is. If component prices have come down they could drop the price. Say to $399. Then make the 2.0 in six models. 32, 64, and 128 with an wifi only and a 3G. At the same price points they have now
That would give them only one more sku to worry about. If they were sure the units will sell, that isn't so bad
Remember When we were all debating whether Apple should make a 6"-7" tablet, or a 10" model? Now that they've made the 10", I don't see 6"-7" as being the cards now. If 7" seems very popular with Android models (likely because of cost issues), then maybe Apple will follow.
But I think Apple wants to make a clear distinction between the two sizes. We know that Apple doesn't want people to be confused over product differences.
Yes, I said that if there was going to be a tablet from Apple that one measuring 5.5"x8.5" would be optimal, since that is the most popular size of (non-electronic) planner/organizer. I stand by that statement, although it seems the larger size is also working out pretty well for Apple.
Notice the part about transfer of title? That's a sale. RIMM just said that they shipped about 14.1 million phones this last quarter, but upon being asked, they admitted that they just sold a bit over 12 million.
Yeah I did post in one of the RIMM threads, 14 million sounds really quite high and close to Apple's numbers.
So can anyone tell me, is it true that as Steve Jobs said, "I don't see them catching up anytime soon"??? (regarding smartphones)
Yes, I said that if there was going to be a tablet from Apple that one measuring 5.5"x8.5" would be optimal, since that is the most popular size of (non-electronic) planner/organizer. I stand by that statement, although it seems the larger size is also working out pretty well for Apple.
I don't see Apple messing with the size of the iPad2 except to make it thinner, lighter. The iPad3 in 8 to 12 months though, could be trimmed down to 9" or something like that. Nothing less than 8" in the next year, I would say.
* RIM Q3 EPS $1.74 vs average analyst estimate $1.65
* Revenue of $5.5 billion, vs avg estimate $5.4 billion
* Ships 14.2 mln BlackBerrys, adds 5.1 mln subscribers
* Shares rise as much as 3 percent in after-hours trade
(Adds detail from conference call; In U.S. dollars)
By Alastair Sharp
TORONTO, Dec 16 (Reuters) - Research In Motion's (RIM.TO) Torch, a touchscreen challenger to Apple's iPhone, lifted the BlackBerry maker's quarterly profit above analyst expectations on Thursday, and the company forecast strong results for the current holiday-season quarter.
RIM (RIMM.O) said net profit jumped 45 percent in its third quarter as it leaned harder on growth from outside of North America. Its shares rose as much as 3 percent in after-market trade.
The Torch, which combines RIM's trademark mini-keyboard with the glitzier touchscreen, shipped to more than 75 carriers in the quarter after an August launch with AT&T (T.N) in the United States. AT&T's half-price promotion from early November also helped sales. [ID:nN09157390]
"The results look pretty good. For the current quarter they definitely benefited from some new products. ... The guidance also looks quite strong," said Shaw Wu, an analyst at Kaufman Bros in San Francisco.
I find it interesting that when discuss cost you looked at the major component costs of hardware but didn't have anything in the mix for the software (iOS) which is a major cost (amortized across product lines and time).
Because it doesn't matter, it is very useful to know how much the hardware costs. That is the price of each unit as it leaves the factory.
Quote:
Putting in these component costs but nothing for software and manufacturing is a huge over site IMHO.
For people that have a grasp of business it is very useful. Besides most of the times the manufacturing cost is rolled into the equation. Such numbers generally are receding to how much it costs to ship each additional unit.
This number has absolutely nothing to do with taxes, overhead or other costs. Frankly I think that these numbers offered up are often bogus. However I'm sure Apple has the cost of every single item down to a fractional cent and knows exactly how much each iPad costs as it leaves the factory. They have to because they have to be able to structure the selling price based on that and overhead.
Quote:
Just my thoughts - could be I don't understand manufacture of a hard product (as opposed to software) since I have spent my career in software engineering (and as a civil engr b4 that in my first life).
I believe you are right here.
There is an old adage in business that you don't make your money based on what you can sell a product for but rather what you can buy it for. The thought being that you have limitations on what you can sell something to the public at price wise. This can be due to the economy, competition or lack of strong interest. So to be successful you buy your component products at the lowest possible cost.
I've basically have worked in the manufacture of hard goods all my life. At first in a job shop and then in a big corporation. Believe me the manufacturing managers are expected to know the products cost to within a fraction of a cent. That is the cost of the product as it leaves the packaging line for the customer or warehouse.
By the way this is not info that is generally shared with the public. For example Apple will never share how much each iPad costs them to build nor will they share the costs of individual components such as the A4. It is extremely sensitive information because again you make your money based on your ability to buy at very low prices.
I just wanted to point out that the numbers are very useful even if they don't reflect additional costs that have to be built into the products price. Those costs though simply have nothing to do with the cost to produce item xyz. In this case we are dealing with educated guesses based on different sources where the error could be rather huge.
Comments
They all say that because it's true.
From Apple's 10K (http://www.apple.com/investor/)
Revenue Recognition
Net sales consist primarily of revenue from the sale of hardware, software, digital content and applications, peripherals, and service and support contracts. The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable, and collection is probable. Product is considered delivered to the customer once it has been shipped and title and risk of loss have been transferred. For most of the Company’s product sales, these criteria are met at the time the product is shipped. For online sales to individuals, for some sales to education customers in the U.S., and for certain other sales, the Company defers revenue until the customer receives the product because the Company legally retains a portion of the risk of loss on these sales during transit. The Company recognizes revenue from the sale of hardware products (e.g., Macs, iPhones, iPads, iPods and peripherals), software bundled with hardware that is essential to the functionality of the hardware, and third-party digital content sold on the iTunes Store in accordance with general revenue recognition accounting guidance. The Company recognizes revenue in accordance with industry specific software accounting guidance for the following types of sales transactions: (i) standalone sales of software products, (ii) sales of software upgrades and (iii) sales of software bundled with hardware not essential to the functionality of the hardware.
Notice the part about transfer of title? That's a sale. RIMM just said that they shipped about 14.1 million phones this last quarter, but upon being asked, they admitted that they just sold a bit over 12 million.
Something like the iPad is so inexpensive at $500 -- that someone will give it away to get you to buy their product. The prize in the cereal box, if you will.
I don't know whether that's someone selling language courses, wine/gourmet food of the month, real estate courses, subscriptions to whatever, home security, college degrees, automotive repair, woodworking...
There is a resort in Key West FL (USA), Island House, that gives you a free iPad when you stay 7 or more nights (I assume to surf the internet on their wifi).
I hope iPad2 has the ability to do something that I want it to do. If it does, I will buy 2 (one for my wife and one for me).
Corrected that for you...
Notice the part about transfer of title? That's a sale. RIMM just said that they shipped about 14.1 million phones this last quarter, but upon being asked, they admitted that they just sold a bit over 12 million.
When Apple shipped their iphones to the carriers, they also transfer title. You can ask the Russian carriers who were holding the bag when they couldn't sell them.
I think you are on the right track, applebaum. If I had my guess, Jobs wants the ipad to be the cheap handle to the expensive razorblades. Or Kodak's Brownie, cheap camera means lots of repeat business in film and processing. The ipads like the Kodak Brownie or the Glillet disposable razor.
Jobs wants us to consume Software and Services on our Ipad 2. The money is not in the Ipad, its in its media consuming appetite.
Thats my guess.
Bingo. That is what the new Carolina Cloud is for. Its to support this base of media consuming iproduct. What a cash stream. And internationally applicable.
Yeah... it's gotta be something like that!
But I don't know if Apple wants to get in the Content business -- it would send a bad signal to other Content providers. Just as they don't get heavy into the app business, because it competes with the developers.
Here's what I want.
If I as a consumer of content , I look at what frustrates me the most -- I can't get the content I want, when i want on the devices I want it.
For live event content I understand I need to watch live; record live; or rent/purchase after the fact.
We pay ATT U-verse $180/mo for basic cable and Medium speed Internet. We Pay ATT Wireless $255/Mo for 5 phones (2 iPhones) and 1 iPad 3G. We pay NetFlix $19 month for streaming Movies and the occasional DVD. Red Box gets another $15/mo. And we've rented or purchased hundreds of LPs, VHS tapes, CDs and DVDs. Spend $50 a month with iTMS. Spend $50/month first run DVDs.
All that, over $500/mo (and all the time, space and equipment) and we still can't get what we want.
If Apple can negotiate/convince the Content Owners to allow demand or subscription streaming to any/all of my iDevices (including AppleTV.
If Apple can negotiate/convince my IP provider to assure acceptable streaming performance through to my router.
If Apple can negotiate/convince my wireless provider to assure acceptable streaming performance through to my iDevices,
If Apple can remove the burden/requirement for me me to manage and maintain a local media-library for all my purchases.
I would gladly pay Apple the $500/month to have Apple either deal with these entities or bypass them.
I would bet you a beer, this is where the growth and direction Apple will go.
When Apple shipped their iphones to the carriers, they also transfer title. You can ask the Russian carriers who were holding the bag when they couldn't sell them.
BS. As usual.
BS. As usual.
From RIM's annual report:
http://www.rim.com/investors/documen...2010rim_ar.pdf
"Devices
Revenue from the sale of Blackberry devices is recognized when title is transferred to the customer and all significant contractual obligations that affect the customer's final acceptance have been fulfilled."
From RIM's annual report:
http://www.rim.com/investors/documen...2010rim_ar.pdf
"Devices
Revenue from the sale of Blackberry devices is recognized when title is transferred to the customer and all significant contractual obligations that affect the customer's final acceptance have been fulfilled."
Yes. And I said that THEY said that they shipped 14 million, but when asked, said that they sold about 12 million. With Apple, shipped and sold are the same thing.
Yes. And I said that THEY said that they shipped 14 million, but when asked, said that they sold about 12 million. With Apple, shipped and sold are the same thing.
Are you sure that you didn't mishear it --- they shipped 12 million in the previous quarter.
Transcript is not out yet.
But they are in the content business. Itunes is # what? in music sales. The App store. The pending IMac applications store. Now working on books. Now working on TV, and movies.
I would bet you a beer, this is where the growth and direction Apple will go.
No!
Apple does not provide content!
Apple resells content owned by others!
Apple breaks even or makes minimal profit for iTunes Music Store and iTunes App Store.
These are used to sell Apple hardware -- same way as OS X, iLife, iWork FCE, FCS, etc.
Apple makes 35-45% gross margin on its hardware!
That's what business Apple is in.
The only thing I don't know about is iAd -- long term, Apple, like Google, could make most of its money from iAd! I hope not!
.
If one thinks of global demand, six million units per month is not that far-fetched.
there are some pretty convincing rumors that 2.0 will support both CDMA and GSM making it a world device. That could help to push the global numbers that high
My fear is that Apple, in their need to keep the # of SKUs down, may ignore this problem.
Or perhaps they won't.
The 16 GB wifi only that we have now is good for a lot of school needs. So maybe they will leave that model as is. If component prices have come down they could drop the price. Say to $399. Then make the 2.0 in six models. 32, 64, and 128 with an wifi only and a 3G. At the same price points they have now
That would give them only one more sku to worry about. If they were sure the units will sell, that isn't so bad
Remember When we were all debating whether Apple should make a 6"-7" tablet, or a 10" model? Now that they've made the 10", I don't see 6"-7" as being the cards now. If 7" seems very popular with Android models (likely because of cost issues), then maybe Apple will follow.
But I think Apple wants to make a clear distinction between the two sizes. We know that Apple doesn't want people to be confused over product differences.
Yes, I said that if there was going to be a tablet from Apple that one measuring 5.5"x8.5" would be optimal, since that is the most popular size of (non-electronic) planner/organizer. I stand by that statement, although it seems the larger size is also working out pretty well for Apple.
6 million a month is... insanity. Kudos to Apple if they could pull it off, it's outrageous.
Notice the part about transfer of title? That's a sale. RIMM just said that they shipped about 14.1 million phones this last quarter, but upon being asked, they admitted that they just sold a bit over 12 million.
Yeah I did post in one of the RIMM threads, 14 million sounds really quite high and close to Apple's numbers.
So can anyone tell me, is it true that as Steve Jobs said, "I don't see them catching up anytime soon"??? (regarding smartphones)
Yes, I said that if there was going to be a tablet from Apple that one measuring 5.5"x8.5" would be optimal, since that is the most popular size of (non-electronic) planner/organizer. I stand by that statement, although it seems the larger size is also working out pretty well for Apple.
I don't see Apple messing with the size of the iPad2 except to make it thinner, lighter. The iPad3 in 8 to 12 months though, could be trimmed down to 9" or something like that. Nothing less than 8" in the next year, I would say.
Are you sure that you didn't mishear it --- they shipped 12 million in the previous quarter.
Transcript is not out yet.
Huh? RIMM said they "shipped" 14.2 million Blackberries. At least that's what's in the news?
http://www.reuters.com/article/idUSN1626944120101217
* RIM Q3 EPS $1.74 vs average analyst estimate $1.65
* Revenue of $5.5 billion, vs avg estimate $5.4 billion
* Ships 14.2 mln BlackBerrys, adds 5.1 mln subscribers
* Shares rise as much as 3 percent in after-hours trade
(Adds detail from conference call; In U.S. dollars)
By Alastair Sharp
TORONTO, Dec 16 (Reuters) - Research In Motion's (RIM.TO) Torch, a touchscreen challenger to Apple's iPhone, lifted the BlackBerry maker's quarterly profit above analyst expectations on Thursday, and the company forecast strong results for the current holiday-season quarter.
RIM (RIMM.O) said net profit jumped 45 percent in its third quarter as it leaned harder on growth from outside of North America. Its shares rose as much as 3 percent in after-market trade.
The Torch, which combines RIM's trademark mini-keyboard with the glitzier touchscreen, shipped to more than 75 carriers in the quarter after an August launch with AT&T (T.N) in the United States. AT&T's half-price promotion from early November also helped sales. [ID:nN09157390]
"The results look pretty good. For the current quarter they definitely benefited from some new products. ... The guidance also looks quite strong," said Shaw Wu, an analyst at Kaufman Bros in San Francisco.
I find it interesting that when discuss cost you looked at the major component costs of hardware but didn't have anything in the mix for the software (iOS) which is a major cost (amortized across product lines and time).
Because it doesn't matter, it is very useful to know how much the hardware costs. That is the price of each unit as it leaves the factory.
Putting in these component costs but nothing for software and manufacturing is a huge over site IMHO.
For people that have a grasp of business it is very useful. Besides most of the times the manufacturing cost is rolled into the equation. Such numbers generally are receding to how much it costs to ship each additional unit.
This number has absolutely nothing to do with taxes, overhead or other costs. Frankly I think that these numbers offered up are often bogus. However I'm sure Apple has the cost of every single item down to a fractional cent and knows exactly how much each iPad costs as it leaves the factory. They have to because they have to be able to structure the selling price based on that and overhead.
Just my thoughts - could be I don't understand manufacture of a hard product (as opposed to software) since I have spent my career in software engineering (and as a civil engr b4 that in my first life).
I believe you are right here.
There is an old adage in business that you don't make your money based on what you can sell a product for but rather what you can buy it for. The thought being that you have limitations on what you can sell something to the public at price wise. This can be due to the economy, competition or lack of strong interest. So to be successful you buy your component products at the lowest possible cost.
I've basically have worked in the manufacture of hard goods all my life. At first in a job shop and then in a big corporation. Believe me the manufacturing managers are expected to know the products cost to within a fraction of a cent. That is the cost of the product as it leaves the packaging line for the customer or warehouse.
By the way this is not info that is generally shared with the public. For example Apple will never share how much each iPad costs them to build nor will they share the costs of individual components such as the A4. It is extremely sensitive information because again you make your money based on your ability to buy at very low prices.
I just wanted to point out that the numbers are very useful even if they don't reflect additional costs that have to be built into the products price. Those costs though simply have nothing to do with the cost to produce item xyz. In this case we are dealing with educated guesses based on different sources where the error could be rather huge.