18:10 After Hours Summary: AAPL up 6.9% in reaction to earnings report; strong iPod sales
17:55 AAPL Apple Computer on conference call (39.75 +1.46) -- Update --
Mgmt notes that iPod is still in its infancy, and likens the potential to that of how Sony shipped 300M walkman's in the 80's and 90's.
17:50 AAPL Apple Computer conference call summary-- Update --
Sales were driven by 450K portable mac shipments and strong iPod sales of 2M... Mac revenue was driven by 836K total shipments, lower than expected due to G5 availability... Sell through was greater in the quarter which sent inventories below the target level... HPQ sold 6% of the iPods, Co does not expect that to be a one time event... Co is expecting to see a marked increase in the Dec quarter of unit shipments... Retail segment saw sales of $4.6M per store (average of 81 stores open during the quarter). Co noted that foot traffic was higher at its retail stores... Mgmt noted that co had a strong back to school business... Gross margins of 27% were consistent with previous guidance and up y/y... Co states that iTunes has 70% market share in the US, and will from time to time hold sales for music... Believes they have 65% shares in Mp3 players... Looking to add more features to the iPod and not looking to contribute to a standard. Two factors that help gross margins going forward are the expanding direct business and the increasing portfolio of AAPL branded software. A negative factor that effects gross margins is the hardware end, which is very competitive. Although co later went on to mention that component pricing was falling, with memory and LCD's weaker than anticipated. This lowering of component pricing drove mgmt to push gross margin guidance higher in the coming quarter.
