Jobless Apple pumps profits 15 per cent
Steve stand-in drops netbook hint
Anyone who predicted that an Apple without Steve Jobs at the helm would drift towards un-profitability must now eat their words.
When announcing Apple's second-quarter financial results on Wednesday, acting helmsman and COO Tim Cook sounded like a man who knows his job is secure. He also demonstrated his mastery of Apple's policy of revealing only what's absolutely required while at the same time letting slip some juicy tidbits to tickle the fanbois.
But Cook earned his confidence. Apple's numbers are good. After the first fully Jobless quarter since the company's co-founder returned a dozen years ago, Apple CFO Peter Oppenheimer was able to exult: "We are extremely pleased to report the best non-holiday quarter revenue and earnings in our history."
Apple's revenue for the quarter was $8.16bn (£5.63bn), an increase of 8.7 per cent from the same quarter last year. The increase in profits was more impressive at 15.2 per cent - from $1.05bn (£725m) last year to $1.21 (£835m) this year.
iPhone sales improved astronomically year-on-year. Now being sold in 81 countries, the Jesus Phone acquired 3.8 million converts during the quarter, a 123 per cent increase over the same period last year. Total iPhone revenue - handset and accessory sales along with carrier payments - jumped from $378m (£261m) in last year's quarter to $1.52bn (£1.05bn) in this year's.
Eleven million iPods were sold in the quarter, a year-on-year increase of 3 per cent. Oppenheimer cited an NPD survey that showed the iPod to have an "over 70 per cent" market share among MP3 players and cited another survey that showed continuing iPod market-share growth in the UK, France, Germany, Japan, Australia, and China - among others. Cook also pointed out that sales of the iPod touch had more than doubled, year-on-year.
The App Store - which should ship its one-billionth app any minute now - now contains over 35,000 applications, an increase of 20,000 since last quarter's conference call. When prodded for information about how many of those apps were free and how many were paid for, Cook sidestepped the question, preferring to remind the questioner that the number of iPod touch and iPhone units in the wild now totals over 37 million.
The news wasn't as good for the Mac. Worldwide Mac sales dipped 3 per cent, from 2.29 million in last year's second quarter to 2.22 million this year, a retreat that Cook described as being due mostly to slow Mac Pro sales because of the Meltdown-induced contraction of professional market, along with the fact that US education sales tanked as school districts froze purchases. "The consumer is holding up much better than the professional," he said, "and much better than education."
When asked whether Apple was considering entering the netbook market, Cook was merciless to the li'l fellows: "When I look at what is being sold in the netbook space today, I see cramped keyboards, terrible software, junky hardware, very small screens...not something that we would put the Mac brand on, quite frankly. It's not a space as it exists today that we're interested in."
He then, however, went on to drop one of those patented Apple hints of future developments by saying: "If we find a way where we can deliver an innovative product that really makes a contribution, then we'll do that." And then the zinger: "We have some interesting ideas in the [netbook] space."
Cook also refused to be drawn into any discussion about whether the PC market has bottomed out, as was recently declared by Intel's CEO Paul Otellini, or hasn't, as AMD's CEO Dirk Meyer suggested on Tuesday. "We're not economists," he demurred. "We're not entering the game of predicting bottoms."
Cook was also asked about a comment he made during last quarter's conference call, when in a thinly veiled reference to the soon-to-be-released Palm Pre he had said ""We will not stand for having our IP ripped off - and we will use any weapons that we have available." This time he was a bit more circumspect - although just a bit: "We think competition is great - we think it makes all of us better - as long as other companies invent their own stuff."
Before the call came to a close, Cook and Oppenheimer tossed out a flurry of stats, such as the fact that there are now 251 Apple retail stores, that it's too soon to fully evaluate the Walmart iPhone partnership, that the iPhone is now being sold in over 50,000 storefronts in its 81 countries, and that AT&T is "the best wireless partner in the US." According to Cook.
Finally - and inevitably - the Man Who Wasn't There's name was brought up. In answer to a request for "an update" on Steve Jobs, Cook passed the question over to Oppenheimer, who gave the stock answer: "We look forward to Steve returning to Apple at the end of June."
Even though the current Cupertinians seem to be doing quite all right on their own. ®