Apple is expected to turn in a strong earnings performance when it posts financial returns for the third fiscal quarter next week. But don't thank the iPhone.
The iPhone only began selling a few days before the quarter ended and, additionally, Apple said it will account for iPhone sales on a "subscription" basis -- meaning it will only count a portion of iPhone revenue each quarter, and add it over time, because it will continue to develop software and functions over time that it will provide customers for free.
But sales are expected to shine nonethless. According to Thompson Financial, the average of analyst estimates calls for Apple to report revenue of $5.28 billion, compared with $4.37 billion for the same quarter a year earlier. The average also calls for earnings per share of 72 cents, compared with 54 cents for the year-ago quarter.
Apple's strength can be seen in the growth of sales of some solution providers. Michael Oh, president of Tech Superpowers, a Boston-based solution provider and Mac specialist, said the financial returns for his company for most recent quarter were down from the quarter before that -- but that business is strong nonetheless.
"The first (calendar) quarter was 50-percent year-to-year growth," Oh said. "The second quarter was 18 percent (growth). There are always going to be seasonal effects. But (the returns reflect) two quarters in a row of double-digit growth. That's a pretty good sign from our standpoint that Apple is pretty strong."
According to research firm IDC, Apple has moved into a virtual tie with Gateway for third-place in U.S. PC market share, at 5.6 percent, and stood on the list distantly behind Dell and Hewlett-Packard in the U.S. Apple's share climbed from 4.8 percent from the year-ago quarter, according to IDC, Framingham, Mass.
"It's been very strong," Todd Frank, president of MacMyDay, a Los Angeles-based solution provider and Mac specialist, said of Apple's momentum. "People are still buying. The product is good. Are sales are going up. Customers are happy."
Frank said he has "a lot of clients who are just upgading their old computers.
"I've had several people switching from PCs to Macs. They are sick of viruses." Frank said that he believes that even though the iPhone doesn't sell through the channel, it will benefit overall sales of Apple products.
"The iPod did the same thing," Frank said. "Tons of people went out and bought Macs because they loved the iPod."
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