Apple: iPad market will be larger than PC
Sales of iPads were up 166 percent during Apple?s most recent fiscal quarter, with the company predicting that the tablet market will be bigger than the PC market.
Apple said yesterday that it sold 11.12 million iPads during its fiscal fourth quarter, a 166 percent increase over the year-ago quarter. Apple also said that it has sold 40 million iPads to date.
?We think this could be a huge market, and it's bigger than we thought,? said Tim Cook, CEO of Apple during a conference call with analysts to discuss the results.
?It's pretty clear that if you forecast out in time, that the tablet market will be larger than the PC market,? he said.
He also said the iPad is a huge opportunity for Apple.
Earnings miss expectations
For the fiscal fourth quarter ended Sept. 24, 2011, Apple, Cupertino, CA, posted revenue totalling $28.27 billion. In the year-ago quarter, revenue totalled $20.34 billion.
The company?s net profit for the fourth quarter totalled $6.62 billion, or $7.05 per diluted share. For the year-ago quarter, profit totalled $.4.31 billion, or $4.64 per diluted share.
Even though earnings were up, the results did not meet analysts? expectations, who had been expecting earnings per share in the $8 to $9 range.
?The company did not meet analysts expectation but other than that they were very strong results with very strong growth in many of the key product segments,? said Ross Rubin, executive director, industry analysis at The NPD Group, Port Washington, NY.
Similar to the iPhone, Apple is finding traction with businesses for the iPad and reports that 92 percent of Fortune 400 companies are testing or deploying iPods. This includes United Airlines putting iPads in every cockpit.
Apple also addressed how the iPad may be affecting sales of desktop devices, saying that some people are electing to buy an iPad rather than a Mac and a larger number are electing to buy an iPad instead of a PC.
?The iPad is showing very strong growth,? Mr. Rubin said. ?Apple seems to have a commanding lead in terms of the competition in the space.
?It is really in a great position of being a market leader in a quickly growth category,? he said.
The iPhone also continues to sell well, with Apple reporting that it sold 17.07 million iPhones in the fourth quarter. This is a 21 percent jump from last year.
However, overall iPhone sales in the fourth quarter were negatively impacted by the rumours circulating about the fall introduction of a new iPhone.
Company executives said that sales of iPhones declined, especially in the second half of the quarter, as rumours about the introduction of a new iPhone began to circulate.
The new iPhone 4S was recently introduced and is already setting records for strong sales. Apple said it is expecting to set an all-time sales record for the current quarter.
?Looking at NPD?s own data, the iPhone had a pretty strong initial impact at Verizon,? Mr. Rubin said. ?It?s subsided a bit.
?That may be part of the evidence around consumers holding off because perhaps they expected a new handset,? he said. ?That could also speak to competition with Android particularly at Verizon, where Apple does not have an LTE offering.?
Chantal Tode is associate editor on Mobile Marketer, New York