Apple Reports 2006 Fourth Quarter Earnings - Mac Sales Rise 30 Percent

« Previous article.
Next article. »

Oct
18

By: switchtoamac at: 4:19 PM on October 18, 2006 | Comments (0)

On Wednesday October 18, 2006, Apple Computer released financial results for its fiscal 2006 fourth quarter (Q4) and its Fiscal Year 2006 earnings.  Apple posted revenue of $4.84 billion US and quarterly profit of $546 million equating to $0.62 on a per share basis.  Gross margin checked in at 29.2 percent an increase from the 28.1 percent in the year-ago quarter.

The highlight of the report was the 1,610,000  million Macs sold during the quarter.  The Mac unit sales blew away Wall Street and Analyst expectations and checked in as the best Mac unit shipments in any quarter in Apple's history.  The 1.61 million Macs accounted for 58 percent of total revenue in the quarter.  Prior to the report, consensus estimates expected Apple to ship a total of 1.47 million Macintosh (Mac) computers during the quarter.

Key Metrics from the Quarter:

  • Shipments of 1,610,000 Macintosh computers, a 30 percent increase (29.6 rounded to 30) in units compared to the year-ago quarter (2005) and up from the 1,236,000 sold last quarter (Q3 2006)
  • Portables sales: 986,000, up 55.5 percent compared to the year-ago quarter
  • Desktop sales:  624, 000, up 3.7 percent compared to the year ago quarter
  • Shipments of 8,729,000 iPods, a 35 percent increase to the year-ago quarter
  • International sales accounted for 40 percent of the quarter's total revenue

Taking the fourth quarter numbers into account, Apple sold 5,303,000 Macintosh computers (best ever in a year) during the fiscal year up from the 4,534,000 sold in fiscal year 2005.  That's a 17 percent increase year over year.  Here's a look at Apple's Macintosh Sales for Fiscal Year 2006

2006 Mac Unit Sales

Quotes from Apple Executives:

Apple's CEO Steve Jobs stated the following: 
  • “This strong quarter caps an extraordinary year for Apple. Selling more than 39 million iPods and 5.3 million Macs while performing an incredibly complex architecture transition is something we are all very proud of,”
  • “Looking forward, 2007 is likely to be one of the most exciting new product years in Apple’s history

Commentary and Opinion:
Q4 2006 marked the eight straight quarter in which Apple shipped at least 1 million Macs, a trend that started in Q1 2005.  The following is a view of Macintosh sales over that period.  It's clear that the trend is upward and that sales are picking up momentum.

Past 8 Quarter Mac Sales

In my October 10, 2006 preview I predicted that Apple would ship 1,640,000 Macs during the quarter.  My rationale used data from prior quarters, Mac model releases during fiscal 2006, and events that transpired during the fourth quarter.  I missed the number by only 30,000 units.  I slightly over estimated Portable units by 14,000 units and desktops by 16,000 units.  Although my prediction was above the actual numbers, I gave a more accurate prediction than Wall Street Analysts, who had consensus estimate of only 1.47 million.  In my post yesterday, I discussed how some analysts raised their projections over the past few weeks but still, they were way off the mark.

Apple's Press Release can be found here.

Speak your mind - Leave a Comment