Reporting results for the fourth fiscal quarter of 2009, Apple sales and profits continue to defy a moribund economy, and for the first time in the company’s history ten million Macs have been sold in a fiscal year.
Apple reported revenue of $9.2 billion and a net quarterly profit of $1.67 billion, or $1.82 earnings per share (EPS), handily beating consensus estimates with the most profitable quarter ever. Apple CEO Steve Jobs issued the expected statement high-five.
“We are thrilled to have sold more Macs and iPhones than in any previous quarter,” said Steve Jobs, Apple’s CEO. “We’ve got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010.”
While the great financial news is the primary indicator of the strength of the company, for the consumer the strength of a platform is in the number of units sold. For Mac and iPhone owners, the fourth fiscal quarter was great, but iPod numbers are more nuanced.
While the 3.05 million Macs sold was a record number for Apple in a single quarter, there is another milestone to ponder. For the fiscal year—and likely calendar year—of 2009, laptops account for two out of three Macs sold. Considering that it was only 2002 when that ratio was reversed, the conclusion that we are nearing the end of the desktop era, at least for Macs, seems inescapable. Another apparently inescapable conclusion is that the iPod has peaked.
Unlike the iPhone with vast arid wastes of China to sell to, and the Mac with vast arid wastes of Windows market share to take from, the iPod already owns somewhere over 70 percent of the portable media player market. Where do you go from there? Nowhere, hopefully. Even taking into account last quarter’s numbers, Apple will sell more than 50 million iPods in 2009, just like the last two years. One could even argue that potential iPod sales lost are becoming actual iPhone sales. In that scenario, lost iPod sales are actually a benefit to Apple, as the average selling price for the iPhone is higher than the iPod. If that is the case, there was much of such benefit to be had in the fourth quarter.
More than any other Apple product, iPhone sales rise and fall with new models. As the chart shows, after the introduction of each new iPhone sales surged, then dropped, albeit at significantly higher sales levels after each cycle. The question now becomes whether iPhone growth is leveling off, like the iPod, or whether the apparent plateau in sales is a pause before continuing the climb with the release of the iPhone in China.
Regardless, only the most pernicious of anti-Apple hater can see these results as anything but the staggering success they are for a company that nearly went out of business just over a decade ago. What’s more, 2010 is shaping up to be even better, with what was hopefully a thinly-veiled reference to the tablet by Steve Jobs. Expect analysts to futilely attempt to pry more information from Apple during the conference call, and TheAppleBlog to duly report the obfuscations.