Apple Reports March Quarter 2007 Results
Apple has reported financial results for the March 2007 quarter. According to the press release (25 April 2007), Apple:
posted revenue of $5.26 billion and net quarterly profit of $770 million … . These results compare to revenue of $4.36 billion and net quarterly profit of $410 million … in the year-ago quarter.
shipped 1,517,000 Macintosh® computers and 10,549,000 iPods during the quarter, representing 36 percent growth in Macs and 24 percent growth in iPods over the year-ago quarter.
From the conference call:
- CFO Peter Oppenheimer reiterated plans to open stores in Sydney, Australia, as well as Glasgow, Scotland later this calendar year.
- As Apple plans to offer software enhancements free of charge through the life of the iPhone and Apple TV, Apple will be using ‘subscription accounting’ where revenue and product cost of goods sold is recognised on a straight line basis over 24 months. Engineering and Sales & Marketing will be expensed as incurred, they will not be deferred.
- Asked a question about staffing issues and the Leopard delay, COO Tim Cook said, “We have no issue at all in hiring really great people. This is just simply a matter of there is two very … iPod is a very revolutionary product, it uses the Mac OS as you know, and so we had always planned on using Mac OS resources to complete the iPhone. It’s taking us a little more time than, a little more resources than we thought, and so we made a choice and delayed Leopard. We think its the right choice.”
- Asked by Gene Munster if Apple could fulfil predicted orders of 1 million iPhones in the June quarter, Tim Cook stated that it is, “very difficult to tell what the demand is until you’re actually shipping the product … I haven’t started ramp yet so I don’t want to predict what our supply would be.”
- Asked about the economics of the iTunes Store given the new pricing of the DRM-free songs, Peter Oppenheimer reiterated the strategy of running the store at a little over break even as selling music and video is a great way to sell iPods. Peter said this strategy is working extremely well.
- Mac unit shipments grew at 38 percent in Europe with industry growth projected at 5 percent. Asia-Pacific was the fasted growing region, it grew at 89 percent against IDC projections of 14 percent.
Listen to the conference call (QuickTime webcast or Earnings Podcast at Apple Investor Relations).
© Danny Haynes
