Apple profit surges 95 percent on iPod sales

Yahoo News ^ | 01/18/2006

[Panerai]

Apple Computer reported a 95 percent rise in quarterly profits on exploding sales of its iPod music players, and notched more than one billion dollars in sales through its retail stores. ADVERTISEMENT

Apple s stock, though, fell in after-hours trading because Apple offered a forecast that fell short of Wall Street estimates.

Apple reported net income of 565 million dollars, or 65 cents a share, for the first fiscal quarter to December 31, up from 295 million a year earlier. The report beat analyst forecasts of a profit of 55 cents per share.

Sales rose 64 percent to 5.75 billion dollars. Chief executive Steve Jobs disclosed Apple's quarterly revenue result January 10 at the Macworld conference in San Francisco.

Consumers snapped up 14 million iPod devices during the holiday quarter, and Apple has now sold more than 40 million since late 2001. The groundbreaking product has transformed Apple from a niche PC maker into the leading purveyor of digital media.

Apple also sold 1.25 million Macintosh computers during the quarter, a figure that was up 20 percent from the year-earlier figure. Apple is in the process of transitioning its Mac line to Intel rocessors, and it expects to have all of its PCs running on Intel chips by the end of this year.

"We are thrilled to report the best quarter in Apple's history," said Jobs.

[savedbygrace]

All that is a non sequitur in relation to my post #76. That related specifically to the prior expections and performance for Q1, not for the current quarter. The quote I pulled from your #8 was only about expectations of Q1 versus the actual Q1 numbers, not about the forward looking statements in Apple's Q1 report, and the market's reactions to them.

[rwfromkansas]

Ipods are rip-offs.

I prefer other mp3 players.

[rwfromkansas]

I do use itunes. Great service, and if I want it to be an mp3 instead of mp4, I just use ijukebox conversion software.

But, I would never buy an Apple computer unless they became much cheaper.

[N3WBI3]

Cellphones will quickly become a "do everything" device.

Most of the people buying iPods are not looking for a do everything device. They are looking for a music player and when its the size of a business card and only a bit thicker its not like having an iPod and a phone are going to cause clutter.

Hell, my cellphone which is going on 2 year old technology does everything an ipod does, full pda, gps, internet browser, etc, and watch TV if I paid for the service.

If the capability is out there I wonder why people are not doing it in bigger numbers? hell according to this there should no no market for PO MP# players *period*.

Ipods are just a fad.

Define Fad. Ipods are going on 6 years old and selling as well as ever. They have evolved and refined their product without throwing useless features on it. If what you say is true the whole idea of a dedicate Audio Player / Video Device is a fad..

[N3WBI3]

And Quality! My wife and I are just now looking into replacing our well used Gen2 iPod after years of use. The iPod still works fine except the battery life is starting to shrink. We still use it all the time.

I bought a Neuros two years back and the damn thing only lasted a few months before it started to act funny..

[steve-b]

Cellphones will quickly become a "do everything" device.

None of the attempts in that direction are ready for prime time. I have a cell phone with a calendar (that I haven't been able to Bluetooth-sync to my PC), a USB drive (if I remember to bring a somewhat bulky cable), an MP3 player (that requires another custom cable to connect the headphones), and an alarm (which actually works reasonably well). The dedicated Palm unit works better on all counts (except that the MP3 player hisses like a bathed cat).

[steve-b]

I know people with first generation iPods still using them on the original battery.

Mine still works fine (albeit I'd lost track of it for a while, so it went unused for about a year).

[steve-b]

If you're a PC user you have to learn how to use iTunes, a fairly complicated and finicky piece of software, just to copy music to the iPod.

There are also third party software packages like EphPod. Some of them will allow you to copy tracks from the iPod (you're a grownup, and are responsible for your own decision to obey or break the law).

Apple should offer a separate battery charger for their newest iPod models at extremely low cost--a lot of people don't want to hog a USB port just to charge the unit.

You can get on-the-go USB chargers (basically, a box with a USB port and connections for four AA rechargeable batteries) for about $20. NOTE: There are also devices that work in the opposite way (insert four AA rechargeables and plug the cable from the box into a USB port to charge the batteries); check the description carefully to make sure you're getting what you're looking for.

[N3WBI3]

Has Apple fixed the battery issue with Ipods? It used to be you couldn't replace the battery, so when the battery ran out in a year, oops that 300 dollar Ipods now worth about 3 cents.

Some iPods had an issue (few in number) and apple handeld it poorly. My wifes 6 year old iPod just started in teh past few months to show issues with the battery...

[SunkenCiv]

"The Intel shift is hurting sales of existing inventory."

Yeah, that makes sense, and is as expected. Apple could reduce its old (obsolete) inventory, or remainder it out, but that could hurt sales of the new machines, and also lead people to expect cut-rate prices. Looks like Apple stock is not something to buy, but is probably a hold, eh, except for those who bought for the first time only recently, and need to try to sell now, or to buy more to dollar cost average. :')

Looks like $50 a share appreciation in a year, having nosed over in the past week.

http://moneycentral.msn.com/investor/charts/chartdl.asp?Symbol=AAPL

"Buy on mystery, sell on history." -- Paul Kangas

[LexBaird]

Problem is, Apple kept that interface on the PC version, when they should have re-written it from the ground up so it has a familiar "look and feel" of a Windows program.

That's not a problem; that's a strategy. If Apple can familiarize Windows users with their GUI by leveraging IPod users, that eases transition fears for switchover OS users.

As the Intel Macs hit the market, with dual-bootable machines, this may encourage people to ease into Macs. You'll be able to run the everyday productivity software in the Mac environment (word processing, mail, browsers, spreadsheets, graphics suites), then bop over to Windows for boutique/proprietary/legacy stuff and games. Then, if you want to mess with Unix stuff, you can do that as well.

[antiRepublicrat]

But, I would never buy an Apple computer unless they became much cheaper.

Of course it depends on what you're looking for, but check out the iMac or Macbook Pro in comparison with similar systems (now that they're both Intel, we can compare apples to apples). A Dell XPS 400 equipped like the iMac but missing bluetooth and wireless and not in the space-saving form factor is more expensive. Put either Macbook Pro (1.67 GHz and 1.83 GHz) against a Dell Latitude D810 at the same price and there's no contest -- the Mac is smaller and more powerful, has a faster DVD writer (slot-load too), and has that cool backlit keyboard. Both of those Macs also come with a lot more standard software.

[Rum Tum Tugger]

Isn't Apple's emphasis on the iPod just an admission that Apple has failed in the computer business? Think about it.

Also, the future is wireless streaming of audio and video, not the storage of MP3, etc. files on a device like an iPod (or a DVR for that matter). So, on that basis, the iPod is a temporary phenomenon whose days are numbered.

[1L]

Such as?

[Muzzle_em]

I wonder if the Mac's price will come down.
I also wonder if the Mac will operate as well with Intel.

[No.6]

"The insiders I know, whose info has always checked out, tell me in strict confidence that the next iPod model will have a keyboard, a 17'' screen, willrun Apple's version of Linux, and will be smaller than the current iPod nano."

Unless I'm mistaken, OSX is based from BSD, not Linux. Just a technicality.

[AbeKrieger]

Check out Creative Zen or any number of similar devices. Just to not have to use iTunes alone....

[Terpfen]

I'm not used to Apple's stuff at all, and still think that iTunes is absolutely easy to use. Most every function can be accomplished with a click or two, or drag-and-drop. Redesigning the thing completely for Windows won't and shouldn't happen. They didn't do it with Quicktime, and no one complains about THAT program (at least, not its interface.)

iTunes is great. I'd rather use Winamp, but that's because I've been using it for 6 years: I'm under no illusions that Winamp is easier to use than iTunes.

[1L]

I HAVE checked them out. They aren't better. Not only do they not sound as good as an iPod playing MP3 files, the AAC files sound better as well. And while iTunes is a resource hog (at least on Windows), the features are pretty good.

I will admit some iPods are overpriced. But they are the best units on the market. I've owned 3, as well as other mp3 players.

[Terpfen]

Rumor has it that the new iBook model line will be more low-budget oriented. I'm not sure if that's a great idea, but that's what the rumor is.

Personally, I think people who want a cheap Mac should just get the Mac Mini. There's a reason Apple charges so much for their stuff, and it isn't profit margin.