Welcome to the TUAW liveblog for Q1 2007 A le Financial Results. Here's where you'll find all our updates, so open a window with this post and keep refreshing as needed. There is no "auto update" on TUAW so unle you refresh (please be gentle!) the page will not change. The conference call is due to start at 2PM PT/5PM ET.The conference call is over, and this quarter was good for A le. Read on for all the details.
3:00 PT. That's all she wrote, folks.
2:58 PT. Retail News: Ended '06 with 6600 retail employees (21,500 A le employees over all) Opened 5 stores in Dec Quarter 7 in March, 35 to 40 in Fiscal '07
2:57 PT. Bootcamp: No virtualization in Leopard? Well A le su ort 3rd party a like Parallels? A le a wer, clearly.
2:55 PT. iLife refresh? "Stay tuned!"
2:55 PT. Cap Ex? 142 million. Retail 36 million.
2:55 PT. Japan? Market is overall weakest in world. MP3 maintained 50% of market, no growth.
2:50 PT. More aggre ive on iPod pricing? We don't disclose pricing pla . Point out that they've sold billio . No problem in selling iPods. (i.e. "No drop in price.")
2:50 PT. iPhone name "Cisco's trademark registration is tenuous at best...If Cisco wants to challenge us, we're confident we'll prevail."
2:45 PT. 1.5 million bootcamp downloads Will be part of Leopard.
2:45 PT. Mac Pro performance? Total pro market met expectatio internally, tempered by some customers still waiting for Adobe Creative Suite. Release in coming 2nd calendar quarter this year. Next quarter. Hope to see customers who have been delaying purchases.
2:45 PT. iPods factors? Favorable commodity pricing environment. Pleased with all elements of the iPod performance. Cash? Buy backs? Stock buybacks are reviewed with sr. management. Maintain strong balance sheets for strategic investments/acquisitio .
2:40 PT. 50% of Macs sold to new users? Best line of Macs ever shi ed before.
2:40 PT. iPod/iPhone ca ibalization? Too soon to tell. Hard to predict. Believe that iPod line shi ing today is great with all its form factors. 2 markets converge? We'll see. iPod has a significant line of difference price points and capabilities.
2:40 PT. Halo effect? Intent to buy Mac Portable 17 to 28% in a year. Mac has outgrown market again, higher than what we projected.
2:40 PT. How think about A leTV o ortunity? Only a few shi ing weeks for this quarter. Included as part of guidance. Too niche market? Broader platform? From a demand point of view, it's really too early to tell. How positioning, see it as the DVD player of the 21st century.
2:40 PT. iPhone question. 10 million units over calendar year is 1% of market. Enough capacity? Will share more details closer to launch.
2:35 PT. 200,000 increase in cha el inventory? Includes all iPods at 40,000 distribution points.
2:35 PT. Number of distribution locatio ? iPod 40,000. Mac 7,500 retail locatio .
2:35 PT. Pausing on Mac purchases due to Leopard? Selectively expanding Mac cha el. 7500 outlets, increased by 1500. 50 stores increase over holiday quarter. Do not see a Leopard-related pause. Looking back to Tiger, did not see a pause then. Average store revenue 6.7Million.
2:35 PT. Leopard? We continue to plan to ship in ring as a ounced at WWDC. Lots of people working on it.
2:35 PT. Product mix? What demand? Shuffles? Do not release ecific units within iPod family. All three models did exceptionally well.
2:30 PT. iPhone a ounced. Gro margin? Not shi ed until June. No product level gro margi per policy. June quarter do include anticipated iPhone shipments.
2:30 PT. International Sales? iPods vs CPUs? Europe Mac unit growth is 28%. Market growth was 9%. 3x market. Exceptional (over 50%) in UK, Switz, Canada, Australia and Japan. Other countries of interest: France, Germany, Italy, ain, Belgium, Austria, Denmark: between 10-20 points per share.
2:30 PT. How much of growth margin leverage is sustainable?
2:25 PT. Declines? Declines are seasonal in nature. Ha y with overall Mac sales.
2:25 PT. More aggre ive Mac pricing? Grew at 3x margin, at 31% market growth (versus 3% for PCs). The Mac continues to outgrow the market. Competitive product offerings delivering above market growth.
2:25 PT. Cingular. It has wide read coverage.
2:20 PT. Operating Leverage. Thrilled by operating margin, 18.6%, e ecially high, 31% gro margi . Positively influenced by revenue. Guided to slightly over 12% for March quarter. Will not project to continue long term (for presumably legal reaso ).
2:20 PT. iPod inventory question. 4-6 weeks of inventory.
2:20 PT. Stores were outperformed by your overall sales? Only 6% store growth? Retail store revenue grew 6% year over year, total Mac sales by 60%. Because of lower iPod revenue (price reductio ) and better distribution cha els. Pleased with stores' performance, bringing new customers to A le. Come June, will sell a lot of iPhones.
2:20 PT. Which commodities more favorable? Last quarter was a great time to be a buyer. LCDs and Flash memory and DRAM will be a good buy as well.
2:15 PT. What about the Feds? They've provided all the details to the SCC and the other feds. Internal review no misconduct. Voluntarily and proactively inform them of their findings.
2:15 PT. What factors for guidance? Great iPod product offerings, range of prices, form factors, to meet many customer's needs and uses. Can share more o ervatio next quarter iPod wise. MP3 market seasonality depends on holiday season buying and i ovative product launches. Always a drop between December quarter to March quarter. Mac-wise, education buying starts in the ring.
2:15 PT. Opening to questio .
2:10 PT. FY2007 off to a "tremendous start". Net income $1 Billion.
2:10 PT. Looking forward to the March Quarter 4.8-4.9 Billion revenue expected.
2:10 PT. Gro Margin is 31.2% Nice!
2:10 PT. $6.7 million in sales per A le store 13,000 customers per store per week. 170 retail stores. No wonder there's always a wait for a genius. 28 million visitors to the A le Stores in the quarter.
2:10 PT. Paramount 250 movies in iTunes (of which, a couple of dozen are watchable.)
2:10 PT. Macbook and Macbook Pro both refreshed. Portable Macs are particularly in demand. 65% portable growth year/year. 60% of all Macs sold were portable. Of course, some of this was probably due in part to the lag on the Mac Pro release.
2:05 PT. Peter O enheimer. Record breaking quarter for A le. 24% growth over December 2006. Driven by iPod sales, and also Macs. Margi were high 18.6%. Net income: $1 billion. Up 78% over last year's. $1.14 per share.
2:05 PT. A le shares rise. "A le shares rose more than 4% in after-hours trading." (Marketwatch)
2:00 PT. Waiting... Mike notes: "The analyst co e us was 0.78 per share and they actually made 1.14 a share." (cite).
1:55 PT. 1.6 million Macs. 26 million iPods A le shi ed 1,606,000 Macintosh%26reg; computers and 21,066,000 iPods during the quarter, representing 28 percent growth in Macs and 50 percent growth in iPods over the year-ago quarter. "We are incredibly pleased to report record quarterly revenue of over $7 billion and record earnings of $1 billion," said Steve Jo , A le's CEO. "We've just kicked off what is going to be a very strong new product year for A le by launching A le TV and the revolutionary iPhone."
1:55 PT. $1.75 Billion "We generated over $1.75 billion in cash during the quarter to end with $11.9 billion," said Peter O enheimer, A le's CFO. "Looking ahead to the second fiscal quarter of 2007, we expect revenue of $4.8 to $4.9 billion and earnings per diluted share of $.54 to $.56."
1:50 PT. Results posted. http://www.a le.com/pr/library/2007/01/17results.html
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