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Apple Earnings Report Q4 - 2012 on October 25th, 2012

[9:39 AM] Adam: Please join us January 23rd at 5:00 PM (EST) for our live coverage of Apple's Q1 FY13 Earnings results call.
[9:38 AM] Adam: Please join us January 23rd at 5:00 PM (EST) for our live coverage of Apple's Q1 FY13 Earnings results call.
[10:02 PM] Bryan: Conference call is over. We already have some detailed reporting up on the news to come out of the call, and are working on more. Join us at macobserver.com!
[10:01 PM] Bryan: I don't recall hearing him take that sort of posture in the past.
[10:00 PM] Bryan: Honest assessment: Peter Oppenheimer is sounding defensive, even adopting a sing-song tone when defending iPad sales.
[9:59 PM] Bryan: He said that iPad mini is more usable than competing 7" tablets.
[9:59 PM] Bryan: He said that 7.85-inches is 35% bigger than 7", which we would like to designate as weasel words. :)
[9:58 PM] Bryan: Tim said that Steve commented on 7-inch tablets, saying they suck. Tim said that Apple will not make a 7-inch tablet.
[9:57 PM] Bryan: Swiss analyst asking about iPad mini. What has Apple learned over the last couple of years that made it release the mini after being down on that form factor.
[9:56 PM] Bryan: Analyst asking if Samsung relationship (or decline thereof) is making LCDs more expensive for Apple. Tim said no.
[9:55 PM] Bryan: Tim said that iPad continues to dominate tablet sales, and that Apple will continue to focus on making a great product.
[9:55 PM] Bryan: New analyst asking if Amazon's decision to sell cheap hardware at cost is effecting Apple's iPad business.
[9:54 PM] Bryan: Tim emphasized that iPhone demand is "very robust."
[9:54 PM] Bryan: Keith asked for clarification on supply/demand balance for iPhone 5, but Tim iterated his earlier lack of predicting when that would come.
[9:53 PM] Bryan: Tim said Apple is projecting China rollout for iPhone 5 during the December quarter.
[9:53 PM] Bryan: Keith Bachman of Bank of Montreal is asking about iPhone 5 launch in China.
[9:52 PM] Bryan: Peter said that ASPs were lower year-over-year for iPad because of iPad 2 and stronger dollar.
[9:51 PM] Bryan: "Gary" is commenting on some accounting issues for Apple. Haven't heard from Gary before, but he's reading a prepared statement on accounting rules for the wonks.
[9:49 PM] Bryan: He expects demand to be robust for iMac, and due to launch times (November and December), a short amount of time to deliver.
[9:49 PM] Bryan: Tim said he doesn't see component shortages for iPad. He said that iMac will be constrained in December quarter.
[9:48 PM] Bryan: New analyst Scott asking about iPad components.
[9:47 PM] Bryan: "I'm feeling pretty good about it," Tim said.
[9:47 PM] Bryan: Analyst asked about Apple's efforts to get iPad into enterprise, and Tim argued that Apple is doing very well in that area.
[9:47 PM] Bryan: He noted that 90% of Web traffic is from iPad, with the implication being that iPad owners like their devices, while people who own competing devices do not.
[9:46 PM] Bryan: Audio dropped out, but Tim is back talking about how much care Apple put in on the iPad mini.
[9:45 PM] Bryan: Peter is saying that the difference between iPad mini and the competition is profound, and that it offers the "full iPad experience."
[9:44 PM] Bryan: New analyst Steve is challenging Apple's contention that iPad mini is priced aggressively.
[9:42 PM] Bryan: Peter Oppenheimer emphasized the 14th extra week in last year's numbers, and to keep that in mind when doing year-over-year comparisons.
[9:41 PM] Bryan: JP Morgan analyst Mark is asking abut iPhone and iPad sales for December quarter.
[9:40 PM] Bryan: Tim said that sell-through for iPad was stronger than sell-in numbers, meaning that he believes there were more sales to end-users than Apple's numbers suggest.
[9:39 PM] Bryan: Apple missed iPad estimates, though it beat its internal expectations, according to Peter Oppenheimer.
[9:39 PM] Bryan: Gene Munster is asking about iPad sales.
[9:37 PM] Bryan: 1.1 million Apple TVs sold. 5 million on the fiscal year.
[9:37 PM] Bryan: He emphasized that he's not worried about it.
[9:37 PM] Bryan: Tim said that he'd rather Apple cannibalize itself than have others do it and he said that the 300 million PCs being sold each year are a better target for Apple.
[9:35 PM] Bryan: New analyst asking if Apple is concerned about iPad mini cannibalizing other iPads.
[9:34 PM] Bryan: He effectively dismissed the Surface as competition.
[9:33 PM] Bryan: Tim Cook said that reviews are calling the Surface a compromised product.
[9:32 PM] Bryan: Surface gets launched tonight. Tim said he hasn't played with one yet.
[9:32 PM] Bryan: Shannon is asking about iPad competitors.
[9:32 PM] Bryan: Tim said "extremely happy" about China performance. Apple is continuing to expand distribution and open new stores.
[9:31 PM] Bryan: Shannon Cross is asking about China. Tim said $5.7 billion revenue in China. Mac sales up 44%.
[9:30 PM] Bryan: He said iPad family will be attractive to many consumers in lieu of PCs and mentioned the product pipeline.
[9:30 PM] Bryan: Tim won't comment on unannounced products, but said he emphasized that tablets will eclipse PCs.
[9:29 PM] Bryan: In other words, he wants to know if "bigger than PC" requires "bigger than 10-inches." He often is mysitified why Apple doesn't do things differently.
[9:28 PM] Bryan: Toni is asking about Apple's expectation that iPad/tablets will be bigger than PCs. He's asking if Apple will introduce larger tablets in the future.
[9:26 PM] Bryan: Toni Sacconaghi is asking about demand, too. Tim said Apple will rollout to 100 countries as planned. Fastest rollout ever.
[9:25 PM] Bryan: He won't predict when Apple will come into supply/demand balance, but says Apple can deliver a ton of iPhones this quarter.
[9:25 PM] Bryan: Tim said demand is "very robust," and said that orders are highly backlogged.
[9:25 PM] Bryan: Bill Shope is asking about iPhone demand.
[9:24 PM] Bryan: Tim Cook is arguing that Apple's focus is on making great products, and that it manages its company for the long-term, rather than short-term profits.
[9:24 PM] Bryan: The point being that because iPhone has grown so large, this will have a measurable effect on Apple's EPS.
[9:23 PM] Bryan: He also noted that amortized income from past iPhone sales will be eclipsed by amortized income deferred for new iPhone sales.
[9:22 PM] Bryan: He also said iPad mini margins will be tight. Actually, he didn't say it, he implied it.
[9:21 PM] Bryan: Peter is saying that all products have gotten new form factors, and that this will lower gross margins.
[9:20 PM] Bryan: Peter is reminding her that there is one week less in the quarter this year. He also said that a changes in currency values are affecting gross margins.
[9:19 PM] Bryan: She is saying that Apple's guiding for a year-over-year decline in EPS.
[9:19 PM] Bryan: Katy Huberty of Morgan Stanley is first. She's asking about Apple's guidance for December quarter.
[9:18 PM] Bryan: Opening questions to analysts.
[9:18 PM] Bryan: $41.7 billion in earnings for the full year. That's so much money...
[9:17 PM] Bryan: $156 billion in revenue for the full fiscal 2012.
[9:17 PM] Bryan: December quarter of 2012 (1st fiscal quarter) will have 13 weeks compared to 14 weeks last year.
[9:15 PM] Bryan: $4 billion in new cash for the quarter. $81 billion is offshore.
[9:14 PM] Bryan: 19,000 visitors per store per week. Stunning.
[9:13 PM] Bryan: Exited the quarter with 390 Apple Stores, 140 are outside the U.S.
[9:13 PM] Bryan: Apple Stores sold 1.1 million Macs, a new record. 18 new stores opened in 10 countries.
[9:13 PM] Bryan: Peter said that Apple has made a number of improvement to Maps, and will continue to work non-stop on making further improvements.
[9:12 PM] Bryan: Moving on to iCloud. 190 million iCloud accounts in the first year of service.
[9:11 PM] Bryan: Peter is running through Enterprise adoption of iPad.
[9:10 PM] Bryan: Peter is touting iPad's benefits for consumers and business.
[9:10 PM] Bryan: The untated emphasis is that it was behind Wall Street's expectations.
[9:09 PM] Bryan: Very pleased with sales of 14 million iPads, which is up 26% year-over-year. He said that was ahead of Apple's expectations.
[9:08 PM] Bryan: Peter is taking the time to tout Enterprise adoption of iPhone. I don't remember him doing that sort of thing during opening comments.
[9:07 PM] Bryan: Peter said demand of iPhone 5 continues to outstrip supply.
[9:07 PM] Bryan: Moving to iPhones. 26.9 million units, up 54% year-over-year, compared to IDC's industry growth of 49%. That means Apple gained share.
[9:06 PM] Bryan: Touting new iTunes.
[9:05 PM] Bryan: Peter is now touting the new iPods, which went on sale this quarter.
[9:05 PM] Bryan: 5.3 million iPods, down from 6.6 million a year ago. iPod touch represents half those totals.
[9:04 PM] Bryan: 3-4 weeks of channel inventory in Macs.
[9:04 PM] Bryan: Peter is now touting Apple's new Macs.
[9:04 PM] Bryan: Mac sales of 4.9 million units is a new September record. Portable sales are all-time high of 80% of unit mix.
[9:01 PM] Bryan: We're beginning.
[9:00 PM] Bryan: Music has started on the conference call.
[9:00 PM] Bryan: Apple's revenues came in at $36 billion, earnings at $8.2 billion, EPS at $8.67. That's a slight miss on consensus. Full coverage at TMO.
[8:38 PM] Bryan: Working on earnings report now.
[4:21 PM] Adam: Please join us October 25th at 5:00 PM (EDT) for our live coverage of Apple's Q4 FY12 Earnings results call.
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