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Apple's Cook talks quarterly earnings, new products

MacWorld Staff | April 24, 2013
Apple announced second-quarter earnings Tuesday, and CEO Tim Cook had plenty to say during the company's conference call with Wall Street analysts.

The numbers that we've seen from IDC would indicate they believe the [tablet] market in March declined by 30 percent from December; December being obviously a seasonally high quarter with the holiday. As you can see from our numbers, we declined 15 percent; and so, if that holds, we did much better than the market, and had a very nice pickup in market share.


iPad MiniiPad mini


And, obviously, on iPad, we continue to have an ecosystem story that is unparalleled; we have 350,000 apps that are optimized for iPad versus a few hundred for our competition. And the overall experience and the fit and finish of the product, I think you would agree, is substantially better than the options there.

On the phone side, the numbers that you talked about, the sell-in comparisons year-over-year, you have to convert that to sell-through to look at the underlying demand. And as I've gone through before, we did grow channel inventory in the year-ago quarter because we were catching up on the rollout of the iPhone 4S. In fact, we grew about 2.6 million. And so you have to factor in to get at the real sell-through. However... if the market did grow by 30 percent-we, still after that normalization, we grew less than that. And so I think the question, or this point is not lost, and we do want to grow faster-we don't view it, however, as the only measure of our health.

The things that are very important to us in addition to market share and unit volumes include things like customer satisfaction, which were the highest by far, winning JD Powers [customer satisfaction survey] nine times consecutively, with the customer loyalty and repurchase rates, which were the highest by far-the 95 percent according to Kantar. And the ecosystem commerce, which attracts developers, is incredible. Analysis says that we have 74 percent; so basically $3 out of $4 that are spent on apps are spent in our ecosystem.

And if you then look to usage statistics, they're staggering at the usage of iOS versus other operating systems. And so, I think market share is important and unit volumes are important, but these other things for us are extremely important, because we're all about customer experience and enriching lives.

Now, that said, we see an enormous number of first-time smartphone buyers coming to market particularly in certain countries around the world. And so what we've done with that, and we started last quarter, is we've made the iPhone 4 even more affordable, and which has made it more attractive to first-time buyers, and we caught up on the demand toward the-late in the quarter last quarter. And we're continuing to do that in other markets. We believe that the phone for the price point that we're offering is an incredible value for people that allows them to get into the ecosystem with a really, really phenomenal product.

On iPhone screen sizes


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