The biggest concern is whether Apple can actually manufacture enough units to satisfy demand, a situation that Microsoft can empathize with. The big difference though, is that Apple will garner somewhere between $1 and $1.7 billion in profit from these purchases, while Microsoft will lose somewhere between $113 and $245 million on sales of its XBox 360s. I wonder who will be having the merrier Christmas?
For those that believe Wall Street to be an accurate predictor of value (I actually don't; Wall Street actually seems best at valuing past results, not future value), Apple hit a new all-time high today near $70 a share, while Microsoft remains fairly flat and well below its five-year high. And Piper Jaffrey on Monday noted that 2006 should be a more robust product year for Apple. Yikes. If 2005 was just an OK year for Apple -- one in which the stock appreciated 96% since June and iPod became the dominant product in digital music -- it will be interesting to see what a 'robust year' looks like.