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Apple (AAPL +1.8%) bounces after AT&T (T) discloses it activated 4.7M iPhones in Q3, well...

Apple (AAPL +1.8%) bounces after AT&T (T) discloses it activated 4.7M iPhones in Q3, well above Q2's 3.7M. That figure comes in spite of Ma Bell's admission iPhone 5 supply constraints affected its postpaid net adds. Apple sold off yesterday on concerns about the iPad Mini's pricing, and perhaps also Tim Cook's claim that cumulative iPad sales topped 100M 2 weeks ago - that implies FQ4 sales of 16M, below an 18M consensus. FQ3 iPad sales were boosted by inventory builds, something that may have led to an FQ4 inventory draw-down.
Comments (15)
  • bgold1955
    , contributor
    Comments (2033) | Send Message
     
    4.7m of 6.1m total is 77% of all activations were iPhone's. Last qtr was 72%. Looks strong.
    24 Oct 2012, 10:46 AM Reply Like
  • Dialectical Materialist
    , contributor
    Comments (4458) | Send Message
     
    ATT and VZ combined sold 7.8 million iPhones compared to 6.4 last qtr. That is a 21% increase. If Apple is merely level with last qtr they will have sold 26 million, so any increase is definitely good news. The margins are higher on iPhones than iPads and that may help earnings as well.
    24 Oct 2012, 11:39 AM Reply Like
  • Humble Eagles
    , contributor
    Comments (1737) | Send Message
     
    If they passed 100 million on Oct 9th, then they probably sold 15.5-16 million Ipads. However, as stated above Apple dealt with this in last qtr's CC. They sell into their channel of non-apple distributors and sometimes inventory blips make a qtr's numbers either a little higher or lower than actual. They said last quarter's numbers were inflated a bit (a little over a million) and implied this qtr's numbers would be robbed a bit. So, they likely sold about 16 million last qtr and 16.5-17 million this qtr in reality. Not bad, considering the current holiday qtr adds two new Ipad models to the mix.
    24 Oct 2012, 11:45 AM Reply Like
  • bgold1955
    , contributor
    Comments (2033) | Send Message
     
    @humble. Good point and I understand your math. However, did you get your 100m from cook's statement yesterday? If so, I am a bit more optimistic, maybe I shouldn't be, but I would think with back to school we would see a much higher iPad sale volume than prior qtr. What do you think?
    24 Oct 2012, 11:59 AM Reply Like
  • Humble Eagles
    , contributor
    Comments (1737) | Send Message
     
    Yes, they mentioned it in the presentation...that Apple had sold their 100 millionth Ipad a couple of weeks ago. I ran a quick check and estimated 15.5-16 million for the qtr. Back of the envelope, so I wouldn't bet a wooden nickel on it. Well, you have to figure that a major rollout produces tremendous volume, and as I explained, Apple stated that they basically presold a little over a million in the third qtr. The tone is definitely not to expect a huge number in Q4 because of inventory blips. I discussed this with some more thoughts in an Instablog here: http://bit.ly/RVNsUh
    24 Oct 2012, 01:26 PM Reply Like
  • bailinnumberguy
    , contributor
    Comments (1090) | Send Message
     
    I'm guessing that they're referencing the quarter as being when they crossed 100 million iPads. I could be wrong, but I can't imagine that some guy in a Walmart in Milwaukee goes to the cash register, the register rings, balloons drop from the ceiling and Apple's management shows up to inform him that he's # 100 million.
    24 Oct 2012, 10:53 PM Reply Like
  • Dialectical Materialist
    , contributor
    Comments (4458) | Send Message
     
    I agree bailin, but Cook did say *two* weeks ago and not *three*. This suggests that, balloons or not, they didn't get to 100 million until after the qtr ended. Unless he is choosing to count sales differently than they do for earnings. For example channel fill counts for earnings, but they could exclude it for the 100 millionth sold (you would hope they would). Then again, channel fill prior to a refresh would be very light anyway.
    24 Oct 2012, 11:47 PM Reply Like
  • Internal Source
    , contributor
    Comments (313) | Send Message
     
    I still really laugh about the mini pricing "problem", keeping in mind the amount people spend without really even knowing it, on things that are incredible wastes of money (diet Cokes, venti lattes, smokes, etc.) and add up to tens, if not 100s, of dollars weekly. That big $30 difference in the high-quality mini (BMW) versus the Nexus (Hyundai at best) is quickly cancelled out by the three venti lattes, five diet Cokes and two packs of Marlboros consumed by a potential buyer in one week. Maybe they'll own and use the tablet for, say, 75 weeks (a year and a half for a non-upgrade-fancy user). So, for 74 weeks they could have had better had they given up one week of waste. Somebody needs to do a scientific study - you know, the kind that shows how, really, dumb people are. ;)
    24 Oct 2012, 12:38 PM Reply Like
  • Glenn Abrett
    , contributor
    Comments (1552) | Send Message
     
    I laugh too at the 'pricing' issue. Shows the incredible buildup of apple negativity -- has happened before on several occasions. Always in the past providing great opportunities to make money. Hopefully this time as well.

     

    Here is a point lots of folks miss. If you want to buy a mercedes which is (arguably) a better car than an equivalent toyota, simply to get the status of the mercedes brand and, perhaps, a more fun driving experience, you have to pay something like a $15,000 premium, model for model.

     

    If you want to get an apple product, which is at least somewhat better product than any competitor model for model, for both the user experience and the status, you have to pay between zero (for a phone) and $500 (for a laptop) more. For an ipad mini you have to pay $30 more.

     

    I think this is one of apple's great strengths. For incremental dollars that most middle class people can afford, you get the best. The mercedes or ferrari of phones, computers, tablets, music players. And this desire to have the best, a desire that is prohibitively expensive in cars, houses and other things, is ridiculously cheap for apple products. And let me tell you. If you know any teenagers. An apple phone confers at least as much status as a cool car or nice clothes. Phones are important to young people -- I mean really important -- central to their lives and their cool.
    24 Oct 2012, 01:20 PM Reply Like
  • jazzybest
    , contributor
    Comments (65) | Send Message
     
    Reminds me of S.Jobs response to why he does not make
    cheap netbooks:

     

    Netbooks aren't better than anything," he said to rousing laughter. "They're just cheap laptops."

     

    What has made Apple leader is not cheap copy-cats but innovative best in class products.
    24 Oct 2012, 01:20 PM Reply Like
  • DanoX
    , contributor
    Comments (2647) | Send Message
     
    I say the same thing to people who buy PC's instead of Mac's, Walmart instead Costco or Trader Joe's , most the time I lose, most people want cheap and just good enough quality.
    24 Oct 2012, 02:01 PM Reply Like
  • Lake Investor
    , contributor
    Comments (198) | Send Message
     
    Moreover, a very large number of people buy the ipad for business use. If they are in the top tax bracket you have to knock anywhere to 35-45% off that effective after tax price. Many people don't give it a thought. My son-in-law runs a company in Beijing and he tells me stories of people laying out two weeks salary in order to get an iphone. If you have to have it . . .
    24 Oct 2012, 08:07 PM Reply Like
  • wkozlov
    , contributor
    Comment (1) | Send Message
     
    mediocrity @ low price is good enough for average consumer.

     

    Reminds me of a sign posted in a printshop: [paraphrasing]
    "Quality: is like buying oats. If you want clean fresh oats, you must pay a fair price. But if you're ok with oats that have been thru the horse, that's a little cheaper"
    24 Oct 2012, 10:39 PM Reply Like
  • Stockgal87
    , contributor
    Comments (355) | Send Message
     
    I agree. I view the pricing to be a confident move by Apple.

     

    After all, the mini is a much better device than any of the competition. Real quality and innovation.

     

    Wouldn't you spend the money to get a much, much nicer tablet - bigger screen, thinner and lighter, more useful apps, better service and quality?

     

    Something you will be holding and using everyday for a couple of years?

     

    I applaud Apple for not yielding to the pressure to go for a cheap price by making an icky thick plastic product. The mini is sleek and beautiful and when you show it to your friends (you know, the ones that bought a Fire :) they will be blown away how much nicer it is.

     

    Frankly, people have to get their heads around the fact that highly engineered, well built, and beautifully designed products are worth more and should cost more. For what the mini is I think it's a great value.
    25 Oct 2012, 12:07 PM Reply Like
  • scott trader
    , contributor
    Comments (4771) | Send Message
     
    The quickest way to kill the human spirit is to ask someone to do mediocre work.
    -
    Ayn Rand
    25 Oct 2012, 10:39 AM Reply Like
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