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Every time I go into an Apple store, I see product flying out the door! It's just looking better and better for Apple. I can't wait to see a MS store go up next to my Apple store. OMG the horror...for MS that is.

Jul 17, 09 - 05:29 pm Comment from: Anonymous©

Is it just me, but didn't Oppenheimer say they were deferring iPhone revenue until OS 3.0 was released, just like last year, so that sales between the end of March until OS 3.0 came out, means iPhone sales will only count about 2 weeks worth of sale in the whole quarter, and then those sales are being deferred over 8 quarters. In other words, iPhone revenues will be light, because of the way Apple is accounting for them. I'm not talking about the normal deferral, I'm talking about the deferral deferral due to the OS release.

Jul 17, 09 - 05:44 pm Comment from: ken1w

@ Anonymous©

> means iPhone sales will only count about 2 weeks worth of sale in the whole quarter.

Apple recognizes iPhone revenue over the course of 24 months. So the recognized revenue for last quarter counts every iPhone sold for the last two years (which is every iPhone ever sold). That number keeps going up as Apple sells more and more iPhones per quarter - which is the beauty of the way Apple accounts for iPhone revenue. It is consistent (does not fluctuate too much short term based on current unit sales) and keeps going up, as long as Apple continues to increase the long-term rate of iPhone sales (which Apple is doing handily).

I want to send any analyst or journalist who uses data or verbiage including the term "whisper number" to Guantanamo. I can think of no better way of body-slamming a stock than to set expectations of nose-bleed levels, especially in this economy. Why can't analysts stick to straight expectations they research (if they do that at all) and react accordingly when the actual quarterly results are announced?

For that matter, I am no fan of earnings guidance. I've seen companies pressured into setting guidance above what is reasonable, or the other way around, quite possibly a practice used by Apple to fend off expectations and whisper numbers.

Enough of the BS. Let reality rule. Whisper numbers are part of a game of greed and of screwing the small investor.

That said, I concur with others above. I have spent a lot of time in some local Apple stores in the past month, and each time, every Apple Store representative was busy writing up an order for either an iPhone or a Mac. I've talked with a number of Store employees, and a common refrain has been, "What recession? Not here. They just added to my hours, and we're adding employees."

That should tell you something. But as for the whisper number guessing game, it's one I won't play. And I hope nobody else is foolish enough to do the same.

Jul 17, 09 - 09:19 pm Comment from: quietly, please

@Not: You can "not play" all you want - and believe me, I sympathize - but I believe in Apple as a going concern and therefore am a long-term owner of Apple stock. It's done very well for me, but I LOATHE being subjected to the blatant manipulation of these "whisper numbers" and assorted other garbage that are perpetrated upon small investors.

I would dearly love for the SEC to arrest a few people for manipulation of AAPL.

Jul 17, 09 - 09:52 pm Comment from: ericdano

Apple is going to post a $1.30 a share.....

Jul 17, 09 - 10:06 pm Comment from: DogGone

The stocks pumped up in the last few days. There will probably be some profit taking after the results.

Apple to post 150 BTW but you didn't hear it from me.

@kenw1
yes I know all about the normal deferral of iPhone revenue. I'm talking about the deferral of recognition of any sales thus quarter until Mobile OS X 3.0 was released. They did the same last year, if you recall for OS X 2.0.

Jul 18, 09 - 03:17 am Comment from: Steveeee

@anonymous,
... but iphone OS 3.0 was released in mid June, so it should be included in this quarter.

Jul 18, 09 - 05:25 am Comment from: ken1w

@ KenC or Anonymous© (or whoever)

Deferral or not, the important thing is that the incremental revenue from sales of all iPhones sold during the previous two years is being recognized during the quarter. That is the important number and over-shadows any sales during the last few weeks of the quarter that were or were not "deferred." If it was deferred, it will get counted eventually.

Jul 18, 09 - 07:09 am Comment from: Always Right

"That would be a earnings dip of about 2 percent..."

No, that would be AN earnings drop...!!!

Jul 18, 09 - 07:20 am Comment from: Anonymous©

Did you just repeat yourself?

Jul 18, 09 - 07:50 am Comment from: Anonymous©

We know that analysts are dumb. We also know from the above story that analysts are expecting strong iPhone sales and strong numbers. We also know that missing projections by as little as $100M can affect analysts and the market.

I am pointing out that NO revenue from iPhone sales from March 17th to June 8th is being recognized in this earnings report, that leaves just the last 3 weeks of the quarter. I think Steveee above, thinks since the iPhone was sold in the quarter that all of the sales in the quarter will be recognized. That is NOT the case. Apple will only recognize those 3 weeks of sales, not the full 13 weeks in a quarter. Those missing 10 weeks, 1/5th of a year's sales will have an impact on the numbers. Given how dumb analysts are, are you sure that they have figured out what Apple is doing?

The difference in delaying the start of revenue recognition of 2.5M in iPhone sales during those missing 10 weeks is about $200M in this quarter. If Apple misses analyst projections by $200M or less, do you think the market will understand what happened?

Here's a direct quote from Oppenheimer at last quarter's conference call:

"Developers have responded very enthusiastically to the new SDK and we expect that customers will love the many new features of iPhone OS 3.0 and the new apps that will be available. Because we announced these specific new features and plan to provide iPhone customers to them as a free upgrade, we have delayed the start of revenue recognition for all iPhones sold on or after March 17th announcement date until the iPhone OS 3.0 software is released this summer."

Jul 18, 09 - 08:18 am Comment from: quietly, please

Anonymous: Since iPhone OS 3.0 was released in the quarter ending June 30, it will be accounted for when revenue numbers are provided. Had Apple deferred release until July 1, then what you say would be true (and would be a problem for clueless analysts and therefore for stockholders). However, because the revenue did show up during the quarter, there ought not to be a problem (since iPhone sales were light until the 3GS was announced and people understood the new product line). So, it might be a little light, but not a huge hit. Deferred recognition of only the sales from March 17 through June 8 means that (averaging) 1/12th of the revenue from sales during that period - and remember that was a light sales period - won't be recognized in this quarter (and will therefore have a longer tail). I don't expect that to amount to much - probably only low double-digit millions.

Jul 18, 09 - 08:49 am Comment from: DanielM

@ quietly,please re, "I would dearly love for the SEC to arrest a few people for manipulation of AAPL."

Then they would have to arrest everyone that recommended, not recommended, bought or sold AAPL stock.

Jul 18, 09 - 12:34 pm Comment from: joey

As reported at the end of last quarter, Apple's institutional shareholders account for 70% of all shares held and of the top 10 holders, 8 have increased their position (the top shareholder, FM&R;by 22%) and two have decreased their holdings. These anal-ists ain't gonna rock THAT boat!