Hey, we'll be live blogging Apple's Q1 2012 earnings call right here at 5PM ET!
We're on the call, listening to very soothing music. Apple is saying we're about to begin.
Apple CFO Peter Oppenheimer is on the line, reading the press release as usual. Apple is proud of its record iPhone, iPad, and Mac sales.
Apple added an extra 14th week to the quarter, which helped its results. Apple made as much in Q1 2012 as it did in half of 2011 total.
Average weekly Mac sales were up throughout the quarter, and international Mac sales were up 58 percent. MacBook Pro and MacBook Air were strong, as was the iMac.
Onto the Mac App Store. Guess what? It's doing great.
15.4 million iPods compared to 19.4 million a year ago. iPod touch was over half the sales, and iPod sales are a little ahead of where Apple thinks they would be.
The iTunes Store did $1.7b in revenue in the quarter, as it expanded throughout the world. Over 20m songs in the store. $120m worth of downloads in apps and music sold on December 25th alone.
iPhone 4S has popularity is "tremendous," but all iPhone models experienced a growth in sales.
iPhone handset and accessory sales accounted for $24.4b in revenue, up 133 percent.
Talking about iPhone in enterprise and how well it's doing — Apple always talks about this on earnings calls. Playing to the suits, that sort of thing.
iPhone 4S now available in over 90 countries, including China.
15.4m iPads sold in the December quarter, up 111 percent from 7.3m last year. $9.1b in iPad and iPad accessory sales, up 99 percent from last year.
By the way, the iPad is also doing pretty well in enterprise. This is really like the "Hello Peoria!" moment of financial results calls.
iPad is also popular in schools. 1.5m iPads are being used in schools. iBooks 2? Pretty rad.
Over 600,000 copies of iBooks Author have been downloaded since it was released last week.
On to iTunes U — over 3 million copies of the iTunes U app have been downloaded.
More than 62m iOS devices sold in the quarter.
That's something like 11.6m iPod touches, then.
By the end of the month, devs will have earned over $4b from the App Store.
$6.1B in revenue from retail stores. New records for iPhone, Mac, and iPad sales.
Stores sold 1.1m Macs, and half the Macs were sold to people who'd never owned a Mac before. (As usual.)
$17.1m average revenue per store.
110m visitors to the Apple retail stores — 22k visitors per store, per week.
Apple now has $97.6b in cash, compared to $81b last quarter. Apple is actively looking at uses for the cash, but "we're not letting it burn a hole in our pockets."
Apple is very proud of everything. And it's question time!
First Q: Can you describe the iPhone momentum?
Tim Cook: We were thrilled with the 37m iPhones we sold. This is substantially above our 20m unit previous record. We would attribute it to a phenomenal customer reception. We made a very bold bet on demand, and it turns out we were short of supply throughout the quarter and ended with a significant backlog. We're still short in key geographies.
Cook: People were anticipating a new iPhone. I think we made the right decision to go with a broad range of iPhones. I think the 14th week was a big part of this, but everyone knew that.
Cook: We could not be happier — we thought we were setting bold bets, but it turns out we didn't bet high enough.
Q: As we're doing the math here, it seems like the average selling price is up on the iPhone, is that more iPhone 4S sold?
Cook: The iPhone 4S was the most popular iPhone. We typically see a higher mix at launch.
Q: Can you talk about the pent up demand and whether it's in places like the US and Japan that had the phone all quarter, or places where they just got it? And can you catch up on demand?
Cook: I don't want to comment on current sales trends, but given that we just launched in China, I'll say the demand there has been staggering. We're not currently selling through our retail store and demand is off the charts.
Cook: The other countries we launched in earlier this quarter were smaller, we'll see how the supply and demand goes. We did make progress, but we'll see how we do.
Cook: Generally speaking the component environment is favorable, that let us over achieve on margin. Exception is hard drives, which is affected by tragic situation in Thailand. We didn't have a supply issue, but we're paying more for drives.
Q: Can you give more detail on the hard drive situation? Any impact on Mac sales?
Cook: No material supply or cost impact on any of the product lines in December quarter. March quarter, we're expecting a cost increase.
Q: You saw some declines in Flash and DRAM pricing, can you talk about how favorable you expect pricing to be next quarter?
Cook: Last quarter we did receive better cost than we expected, particularly on displays and NAND DRAM, and we expect supply will exceed demand for the industry. The big exception is the hard drive, which is constrained across the industry, and I believe we can navigate the supply issue, but we're paying more for them.
Q: On the iPad, obviously strong numbers — did you see any impact from the lower price tablets, and how do you think about competition from Amazon?
Cook: We're really happy with the 15.4 million iPads that we were able to sell. This is consistent with our long term belief that we've had since before we launched the iPad that this is a huge opportunity for Apple. I believe that there will come a day that the tablet market will be bigger than the PC market. IDC's recent data shows that tablet sales exceeded desktop PC sales in the US. There is significant momentum in this space.
Cook: In terms of competitiveness, the iPad ecosystem is in a class by itself. We now have 70,000 apps, compared to a few hundred for the competition. People really want to do multiple things with their tablets, and we don't see these limited function tablets and e-readers in the same category.
Cook: We don't think people who want an iPad will settle for limited function. Last year was supposed to be the year of the tablet, and most people will agree it was the year of the iPad. We're going to continue to innovate like crazy in this area.
Q: Can you talk about the iPhone 3GS in the post- and prepaid market?
