UPDATE, 3:11 PM: Don’t expect much help from Apple if you want to track the sales for new products including the Apple Watch and services such as Apple Pay, the credit payment system that launched today. Beginning with the current quarter the company will lump together in its reports numbers for its Beats headphones, iPods, Apple TV, peripherals and accessories, and the Apple Watch. “Our competitors are looking for [Apple Watch data] so aggregating it is helpful from that point of view,” CEO Tim Cook told analysts. In addition, revenues from Apple Pay, the iTunes store and other services will be blended into a single number. The only products it will break out are the iPhone, iPad, and Mac.
Cook was eager to counter any sense of disappointment around the falling iPad sales. “We don’t like negative numbers on these things,” he says. Even so, he doesn’t believe that the market is saturated. “People hold onto their iPad longer than they do their phone, and because we’ve only been in this business four years we don’t really know what the upgrade cycle will be. That’s a difficult thing to call. We do know is that people always respond to us doing great products.” That’s why Apple is “continuing to invest in the product pipeline, [and] we are continuing to invest in distribution.”
As for the iPhone, Cook says he doesn’t know when supply will catch up to the surprisingly strong demand – especially for the iPhone 6 Plus — not a bad problem to have. At this point “we’re not nearly balanced. We’re not close. We’re not on the same planet. …It’s very unusual to see every country having a marked improvement over the previous year, and that’s what were seeing an iPhone.” But the CEO declined to offer details about how sales breakdown between the different new and old iPhone models.
PREVIOUS, 1:33 PM: Apple’s share price is just up about 1% in post-market trading even though it reported financials for the September quarter that handily beat most forecasts. The company generated net income of $8.47B, +12.7% vs the period last year, on revenues of $42.12B, +12.4%. The top line exceeded the Street’s expectation of $39.85B. And diluted earnings at $1.42 a share were well above the consensus prediction of $1.31 for the fiscal Q4.
The year “was one for the record books, including the biggest iPhone launch ever with iPhone 6 and iPhone 6 Plus,” CEO Tim Cook says. With other product upgrades, “we are headed into the holidays with Apple’s strongest product lineup ever. We are also incredibly excited about Apple Watch and other great products and services in the pipeline for 2015.”
iPhone was the star for the September quarter. Apple shipped 39.3M units, well ahead of expectations for 38M and up 16% from last year. But iPad sales were less impressive. The company shipped 12.3M, below analyst forecasts for 13M and down 13% from last year. It also shipped 5.5M Macs, topping forecasts for 4.7M and up 21%. Investors have pretty much written off the iPod: Apple shipped 2.6M, a little less than the 2.7M expected, and down 24% from last year.
Apple says that revenues in the three months ending in December could go as high as $66.5B – investors were expecting about $63.5B – with a gross margin of as much is 38.5%.