Apple executives speak: On toaster-fridges, financial guidance, and lawsuits

By Macworld staff, Macworld |  IT Management, Apple, Tim Cook

Apple has unveiled its earnings for another quarter, which usually means two things--a blockbuster financial performance and insights from CEO Tim Cook. The company certainly delivered on the blockbuster performance when it announced second quarter earnings on Tuesday. But this time around, in addition to Cook, chief financial officer Peter Oppenheimer also had a few noteworthy things to say about Apple's fortunes, its product line, and the state of the company. Here are some highlights of what Cook and Oppenheimer had to say to analysts during Tuesday's conference call.

The third quarter will see a sequential downtick, here's why

Oppenheimer: The manufacturing ramps for the iPhone 4S and the new iPad were extremely successful for us. They yielded the highest launch supply and the fastest country rollout for these product families that we've ever had. As a result, we were able to fulfill demand in the March quarter rather than the June quarter this year and that generated revenue of over 39 billion. Therefore, unlike last year, we expect a sequential decline in revenue this year.

I'd highlight five primary factors which has influenced our thinking. The first: the iPhone channel inventory changes. As I discussed in my prepared remarks, we increased our iPhone channel inventory by about 2.6 million units in the March quarter this year, and we exited within our target inventory range of about four to six weeks.

Last year, we continued to add new countries into the June quarter and we built an additional 700 thousand units of iPhone channel inventory last year in the June quarter. So the combination of these channel builds in the March quarter of this year and the June quarter of last year will impact the sequential comparisons from this year to last.

The second factor: Fabulous iPhone 4S execution. As we told you in January, we exited December with significant iPhone 4S backlog, which led to a huge January. We launched China and 20 other countries, also in January, which completed the rollout of the iPhone 4S into all the countries where iPhone is currently shipping. And as I said before, we exited the quarter within supply and demand balance.


Originally published on Macworld |  Click here to read the original story.
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