This Monday, Apple Chief Financial Officer Peter Oppenheimer released the company’s third quarter earnings report during a conference call with analysts and the press. Ending on June 28th, Apple’s third quarter showed outstanding results in multiple areas of sales. First off, Mac sales were the predominant business segment of profit for Apple in Q3. While accounting for around 48% of the company’s total revenue, Apple managed to sell more Macs in Q3 than ever before, a staggering 2,496,000 units. These sales figures are made from a commanding 1,553,000 notebook sales and 96,000 desktop shipments. Both are showing promising rates of increase, with notebooks and desktops increasing sales by 8% and 10% respectively. In a yearly growth of 44%, Apple retail stores, mostly based in the United States, sold 476,000 Macs, totaling to $1.445B of revenue. This revenue is up a whopping 58% from last year.
To summarize iPod earnings, most sales were driven by the iPod Touch and iPod Shuffle models. In all, approximately 11,000,000 iPods were sold, producing $1.678B of revenue. As a reminder, Apple holds 70 percent of the media player market here in America and mostly leads with other percentages worldwide. Apple is also proud to say that they’re iTunes online music store now offers 8 million songs, 2,200 movies, 450 of those movies offered in HD, and 20,000 TV shows.
In iPhone news, the company believes that the new iPhone 3G will meet its yearly sales goal of 10 million and flaunts the product’s first week of sales as a sign of its success. Many sources believe the iPhone is selling out of stock faster than expected in retail stores nationwide.
Overall, Apple’s fiscal third quarter demonstrated a 2.1% decrease in gross margins from last year. Now at 34.8%, these figures are most likely due to the current product diversification not as obvious last year.
After listeners took notes and charted Oppenheimer’s usual number crunching, the media was intrigued when the CFO continuously threw in hints of a “product transition” during his hour long talk. Interspersed throughout the conference, Oppenheimer gave burning curiosity to listeners with remarks of new state of the art products that “will have features and technology that others can’t match”. Because of these soon to come mystery products, Oppenheimer says that gross margins are expected to fall to 31.5% by September and to an all-time low of 30% flat by fiscal ’09. As if this wasn’t interesting enough, he went on to comment on the availability and practicality of consumer NAND flash memory and the availability of other components, such as optical drives and hard drives. Oppenheimer said this during the conference call:
We are working to develop new products that contains technologies that our competition will not be able to match. I cannot discuss these new products, but we are very confident in our product pipeline
On a different note, Oppenheimer said this about Steve Job’s health after it was noted that he did not attend the conference:
”Steve loves Apple. He serves at the pleasure of Apple’s board. He has no plans to leave Apple. Steve’s health is a private matter.”
To conclude the conference, Apple is targeting revenue of $7.8B for Q4 and $1 earnings per share.