KenC

Apple's Deferred Revenues Revisited: This Was a Blow-Out Quarter

Actually, the important point here is that analysts and pundits are comparing Apples to Oranges when comparing YOY numbers. That is, this year's numbers include a HUGE deferred figure, while last year's do not.

And, to the point most are concerned with, Apple is capitalizing expenses like R&D as they incur, while deferring COGS with revenues. Is there a deferred COGS number in the 10Q?

Third, I'd point out why the first point is so important. Some people, like myself, went into an Apple Store over Xmas to choose a new iPod. That choice became one between a Classic, a Touch or an iPhone. Remember Steve Jobs called the iPhone the "best iPod ever". I bought the iPhone, and put my old nano in the drawer. The difference being if I had bought a Touch or a Classic, all of the revenue for those purchases would have hit Apple's top line. With the iPhone, only a fraction, 1/8th, of the money I spent hit the top line. My little decision on my iPod replacement, is treated quite differently by Apple's financial report. How many other people consolidated their iPod purchase with a cell phone purchase? That's why the deferred figure is important in truly comparing Apples to Apples. Apple had a blowout quarter and no one seems to know it.