Checking in with Apple: Price cuts boost iPhone sales units; Mac sales level out

Checking in with Apple: Price cuts boost iPhone sales units; Mac sales level out

Summary: Apple's iPhone price cut has boosted demand to a new sales plateau. Mac sales are leveling out after a back-to-school spurt.

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Apple's iPhone price cut has boosted demand to a new sales plateau. Mac sales are leveling out after a back-to-school spurt. iPods are moving off shelves at a rapid clip. And Apple's latest iPhone software update may have shut down what was a growing resale market.

Those are the conclusions of Piper Jaffray analyst Gene Munster, who detailed his latest sales check in Apple stores across the country.

Here's the nutshell of Munster's findings as published in a research note Thursday.

applechart.png

Overall, Apple looks to be off to another strong quarter, according to Munster. He expects Apple will sell 1.05 million iPhones (all resources, Apple Core) in the September quarter. Demand in September was up 56 percent from August, but iPhone units jumped 200 percent plus after the Sept. 5 price cut. According to Thomson Financial Wall Street is expecting Apple to report earnings of 83 cents a share on revenue of $5.99 billion for the fiscal fourth quarter ending Sept. 30.

Munster is also projecting Mac units in the 2 million to 2.1 million range. A month over month Mac sales slowdown isn't worrisome given the strong back to school bump Apple got in August.

As for iPods, Nanos and Touches are in and classics are out. Among the iPod units tracked by Munster 39 percent were Nanos with 36 percent being Touches. Shuffles were 16 percent of units with 9 percent representing iPod Classics. "The popularity of the touch will drive the iPod's (average selling price) up. In fact, one store we visited was sold out of touches on Sun. 9/30," wrote Munster.

Munster also had some interesting comments about Apple's recent move to render unlocked iPhones inoperable. He wrote:

During our store checks we noticed many people buying iPhones in the maximum 5/customer allotments, which we believe were being purchased to be unlocked and operated on carriers other than AT&T. This trend was especially noticeable in the New York City stores, where one Apple employee acknowledged that customers were buying five iPhones per store visit in order to resell unlocked. At one point during the visit, the store sold out of iPhones. Judging from our checks, as much as 10% of the iPhones sold in Sept. were purchased with the intention to be resold unlocked. On 9/27, however, Apple released iPhone software version 1.1.1 and the update rendered most of the unlocked phones inoperable. In doing so, we believe Apple effectively minimized the market for unlocked iPhones.

Update: Munster's final point about 10 percent of iPhone sales were being purchased to be unlocked is getting big play from Russell Shaw, Jacqui Cheng and Katie Marsal. The figure is notable, but isn't it kind of moot now? After all, many of these iPhones were rendered useless with the iPhone's latest software update.

Topics: iPhone, Apple, Enterprise Software, Hardware, Mobility

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33 comments
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  • Interesting.

    So a drop in sales of 39% is "leveling out"? Interesting spin.
    itpro_z
    • Well depends on how sales were prior to "Back to school"

      season does it not? I would think that most computer manufacturers
      like say Dell and Apple get a large boost during back to school time
      but yes it does level off for a period just before the Holiday period.
      Still I have not figures for what Mac sales were before so I can't be
      sure but to assume it's SPIN is well jumping at any attempt to make
      this negative. It's like chicken little and the sky is falling....no with a
      little research and some critical thinking one would come to the
      correct conclusion that an acorn falling from a tree does not equate
      into falling sky...:P

      Pagan jim
      Laff
      • I wasn't so much trying...

        ...to put a negative face on this, as point out the way these guys always put a positive spin on Apple. If a PC company had shown that kind of "leveling out" the reaction would have been extremely negative.
        itpro_z
        • In all honesty I would love to see DELL's figures for

          this period and or HP's for i'm sure they show a similar jump and leveling off but I
          wonder how much myself?

          Pagan jim
          Laff
          • Dell and HP

            Dell's and Hp's sales are far more driven by corporate buyers than home users, so back to school doesn't have the same impact as it does with Apple. I am sure there is some, just not as much. The question I have asked is, which had more impact, back to school sales, or Mac users replacing their older Macs with the new Intel models. The numbers that I see show that the newer Macs will catch up with the older ones this month, so that trend will begin to slow.

            I don't think that I have ever seen numbers from Dell or HP separating out home sales from corporate/government. It would be interesting.
            itpro_z
          • I also think pure VOLUME would mean different results

            While I'm very pleased too see Apple's computer sale increase as a whole still I have
            to admit Dell and HP's volumes remain higher and much higher at htat so even "IF"
            they do get a boost from back to school sales it would be a lesser effect overall.

            Pagan jim
            James Quinn
          • Also, remember...

            ...that Dell and HP lump their figures together, so their numbers reflect everything from cheap WalMart computers to servers. Makes it rather difficult to compare Apples to oranges (or Dells).
            itpro_z
    • No spin

      If you read what was listed, Macs experienced a "back to school" bump (153/day in July/Aug) compared to what must be considered (from past tracking) the "normal/pre-school" level represented by the Sept period (94/day).

      But you probably knew that...

      Are you related to Zealot by any chance? From someone who seemed (pretended?) to be fairly open-minded, you've certainly become the sites next best anti-Apple zealot.

      ...
      MacCanuck
      • Not so much anti-Apple...

        ...as anti-Apple zealotry. I don't recall anyone mentioning over the last couple of months anything about a "back to school bump" when Apple's sales were "surging ahead of the industry." At the time, I questioned whether the sales surge would hold, or was just a temporary thing. I was, of course, flamed royally for suggesting that. Now, when the sales have returned to normal, as I predicted back in the summer, I am flamed again for having a chuckle about the term "leveling off". Please note that I am not laughing at Apple, just the spin put on this by the Apple zealots.
        itpro_z
        • it only makes sense to look at sales year over year...

          any one with sense knows that... then you eliminate the seasonal effects... do you have THOSE numbers? the numbers you have presented are pretty much useless.
          doctorSpoc
          • Numbers I presented?

            The numbers were in the article, not my post. "Anyone with sense" would have seen that.
            itpro_z
        • also how has Apple performed relative to the market this month...

          those numbers would also be useful but don't make it into the article???
          doctorSpoc
          • Month to month...

            ...numbers don't tell us much, anyway. Quarterly or Yearly figures are much more informative. I wasn't being critical of Apple, just the way the authors presented it. I bet that I wasn't the only one to get a chuckle out of their word choice.
            itpro_z
    • Pent up demand

      New iMacs and back-to-school is reason enough for a temporary peak, followed by the fact that people are now waiting for Leopard to come out before buying a new computer.

      Watch the sales figures once Leopard hits the streets.

      How hard is that to figure out, really?
      MarcB_z
      • Not just back to school.

        The "pent up demand" was also due to the changeover from the older Macs to the newer Intel Macs. Apple's market has always been somwhat "trend" driven.
        itpro_z
    • Leveling out

      Well it wouldn't have been fair to say sales plunged 39 percent from August since we don't know where the normalized rate is. Point is Mac sales popped and then leveled out. Your guess is as good as mine as to where they plateau. Month to month trends aren't all that informative.
      Larry Dignan
      • so why this article?

        You're saying yourself that you don't know how to interpret these figures...and that
        month to month figures aren't all that informative.
        Non-Zealand
        • Month-to-month numbers are NEVER informative

          It can tell you bits of information, but without trends, you don't know if it's normal, and therefore can't make a judgement or a decision about it.

          This is why you can access 10-20 quarters of financial statements for SEC traded companies.

          For those that follow Apple's finances (such as investors) this information would have provided them with additional numbers that they can interpret because they already have previous data. For anyone who doesn't have that information, the numbers are totally useless except to illustrate how drastically a pop (or drop) in sales can actually be, even if it's normal.

          And, of course, to get people riled up (not that that was necessarily the intention, but it is likely to be the result).
          laura.b
      • True

        But that didn't stop anyone from "interpreting" the increase of the last few months as an indication of Apple's becomming more mainstream. I do agree with you, though, that quarterly or yearly sales are a much better indicator.
        itpro_z
    • To be expected

      Leopard is releasing in October. Smart buyers are holding off for a month to get their machine with that OS pre-installed.
      frgough