My Revised Apple 4Q Sales Figures: More Like $8 Billion In Revenue On 23 Million iPod Sales

One company that hasn't been cutting marketing budgets is Apple Computer (AAPL), which was named Marketer of the Year over at MediaPost's Marketing Daily. And NPD released some new data today, showing that Apple increased its market share of the MP3 player market from 45% in 2005 to 57.5% in the five weeks around the holiday season in 2006.

Now this data has some notable omissions. Among them are sales from Wal-Mart (WMT) (a big factor) and the Apple Stores themselves (a huge factor in iPod sales). And the data only covers five weeks, not the entire quarter.

Nonetheless, the data is probably somewhat representative of the quarter, so I did some estimates of the omitted effects. I predict that the Apple stores will be responsible for about 2 million iPod sales on their own, and Wal-Mart will be responsible for another million or so (these numbers are pulled out of the air, so if anyone has better guidance on what I should use for those two estimates, leave me a comment or send me an email). So I plugged it into my model for Apple financials and iPod sales. And below is what I got:

The bottom line: I was a piker in my previous prediction of 20 million iPods and $7 billion in sales for Apple's holiday quarter. Assuming that these numbers are somewhat in line, Apple may see a nearly $8 billion holiday quarter, with $4 billion of that revenue coming from the sales of 23 million iPods.

Full disclosure: I own a small number of Apple shares.

Comments

[reinharden]

Using the marketshare numbers to guess at units:

06/2006 market-share for Intel Macs: 0.36%
09/2006 market-share for Intel Macs: 0.84%
09/2006 quarterly Mac unit sales: 1.6 million
12/2006 market-share for Intel Macs: 1.52%

December units =~ (September units / (September share - June share)) * (December share - September share) => 2.26 million

Way SWAG’d. But interesting. And arguably an understatement...even so, I'm not entirely convinced Apple will hit this number. But I'm pretty convinced they'll definitely come in above estimates.


Depending upon which set of numbers I use I can easily support 19M to 24M iPods. And I think that these are potentially understated, for the same reasons that you cite, as well.


And I think if AAPL hit these kinds of volumes, they drove more through to the bottom line.


One thing that scares me though is how much inventory did they build for this quarter? The Apple Store, for the first time in years, didn't seem to run out of anything. And Amazon got restocked at least a half-dozen times after running out of iPod Shuffles.

reinharden