Apple Sales Exceed Expectations

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By: switchtoamac at: 8:33 PM on January 10, 2006 | Comments (0)

Apple Computer Inc. Chief Executive Steve Jobs stated at Macworld 2006 that sales for Apple's December quarter exceeded expectations on strong demand for the company's iPod music players.  Revenue for the quater came in at $5.7 billion, well above the $5.04 billion average estimate of analysts.  In addition, the company's retail stores posted revenue of more than $1 billion for the first time in their history. Shares soared to a record high following the announcement.

Apple Computer sold 14 million iPods and 1.25 million Macintosh computers during the quarter. Apple has sold a total of 42 million iPods and 850 million iTunes songs since the launch of each product.  The 14 million iPods sold in the December quarter represent 33 percent of all iPods sold by the company.  An amazing metric demonstrating that demand for iPods is surging and that the company is not seeing a slow down in demand for it's music players.  Apple now has an 83 percent share of the legal music download market.

Mr. Jobs also unveiled new Intel microprocessor powered Macs a full six months ahead of schedule.  Jobs also indicated that all Apple computers will have Intel chips by the end of 2006.

The new iMac is based on Intel's Core Duo processors.  The nee systems boast speeds two to three times faster than previous iMac G5 models at the same $1,299 starting price.  The new iMac are now available for order at the Apple Store.

Jobs also unveiled the new MacBook Pro notebook based on Intel's Core Duo processors.  The system runs four to five times faster than the company's prior PowerBook notebooks and will begin shipping in February.  Prices start at $1,999.  Orders can be placed at the Apple Store.

I would expect to see a continuation and strengthening of the "iPod Halo Effect", the idea that the popularity and strong sales of iPods to Windows PC owners translates into increased Macintosh computer sales

It's clear that Apple experienced a new wave of iPod sales during the 2005 holiday shopping season and this provided addition fuel to drive the "iPod Halo Effect".  This is demonstrated by the sale of 1.25 million Macs, marking the fifth straight quarter of at least 1 million Macs sold.  It's likely that a significant percentage of those units sold were from consumers who purchased thier first Macs.  Apple is gaining market share demonstrated by these numbers and by the increase in Safari market share.

Consumers and businesses are making the Switch to Macintosh computers and OS X platform.  With these new systems and the popularity of iPods, I expect the Switch trend to continue and to gain momentum.

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