MacRumors

Apple announced their 3rd Quarter 2008 Financial Results today. Apple posted revenue of $7.46 billion and net quarterly profit of $1.07 billion (or $1.19 per diluted share). This compares favorably to revenue of $5.41 billion and net quarterly profit of $818 million (or $.92 per diluted share) in the year-ago quarter. Apple shipped 2,496,000 Macintosh computers and 11,011,000 iPods this quarter.

"We're proud to report the best June quarter for both revenue and earnings in Apple's history," said Steve Jobs, Apple's CEO. "We set a new record for Mac sales, we think we have a real winner with our new iPhone 3G, and we're busy finishing several more wonderful new products to launch in the coming months."

Looking to the fourth fiscal quarter 2008, Apple expects to earn a revenue of $7.8 billion and earnings per diluted share of about $1.00.

The Mac sales numbers represent 41% unit growth over last year's quarter and the iPod sales represent 12% unit growth over last year's numbers. As we previously reported, Apple's results do not include iPhone sales, which were deferred until the 4th quarter. Apple's financial results webcast will begin at 5pm ET / 2pm PT. MacRumors will provide running highlights of the webcast.

Steve Jobs hints at "several more wonderful new products to launch in the coming months" in Apple's press release.

Conference Call Highlights

- Very pleased to report highest June quarter earnings and revenue.
- 38% growth in revenue over previous year-ago quarter
- Highest quarterly Mac shipments ever
- Continues to see healthy growth in all regions, sales in retail stores very strong
- Mac: 2.5 million Macs shipped. Most in any quarter in Apple's history.
- Apple's share of total personal computers up to 19.5% in June
- Best Mac quarter ever in U.S. education
- Sold 11 million iPods. Up 12% from year ago.
- Great start with iPhone 3G. 22 Countries. 1 millionth iPhone 3G just 3 days after its launch.
- Customer reaction to iPhone 3G overwhelmingly positive.
- App Store: offers more than 900 applications, with 20% free. 90% less than $10.
- Customers loving the App Store. Over 25 million Apps downloaded so far.
- Retail Stores. 476,000 Macs sold. 1/2 were sold to customers new to Mac.
- 216 Stores Worldwide by end of Quarter. Extending international stores. Switzerland and Germany coming.
- Looking forward to 4th Quarter: Great start with iPhone 3G. Expect to sell more iPhones in Q4 than any previous quarter. Due to subscription recording, much of the revenue will be deferred to future quarters. "Future product transition". Can't discuss today.
- More great new products later this year.

Question and Answer Highlights

- International sales growing well. Beijing store doing well already.
- Added 170 Best Buy stores. Total of 570. 600 by end of summer.
- Apple introduces new products that initially cost more because they deliver a new level of value to the customer. Then drive costs down and staying out of reach of our competitors. Apple will follow this plan again in the future.
- Question regarding Steve Jobs' health. Answer: Jobs has no plans to leave Apple. Steve's health is a private matter.
- Apple TV remains a "hobby" because its not a very large business and still continuing to invest in it.
- Stunning response to iPhone 3G. Sold out due to overwhelming demand. Pleased with production ramp. Shipping units as fast as they can. Trying to catch the demand. Confident enough that they will be launching about 20 additional countries on August 22nd. And over 70 countries later this year.
- Apple reiterates they will be delivering state of the art new products at prices their competitors can't match. Very excited about what they have in their new product pipeline.
- Significant interest in Enterprise adoption for the iPhone 3G.
- Looks at App Store like the iTunes Store. Not a huge revenue generator. Instead something to make the iPhone and iPod touch more attractive.
- Welcomes competition from mobile phone companies and believe they are well positioned with the iPhone.

CNN Money reports that some MobileMe customers are still without email service.

The Cupertino, Calif., company has been migrating its .Mac pay email service to an upgraded version, called MobileMe. But in doing so, it has run into problems including service outages and customers losing access to their accounts. It's the latest in a string of issues that have cropped up since the launch of the latest iPhone, an unusual turn for a company known for its attention to detail in its products and services.

According to the Apple's own MobileMe support site, 1% of MobileMe members cannot access MobileMe Mail. The outage has reportedly lasted for 4 days. Apple's discussion forums and our own have seen a number of posts from affected MobileMe customers.

Apple's MobileMe launch as been marred with delays and apologies surrounding the service. MobileMe is Apple's new $99/year service which replaces .Mac and offers customers web-based email, calendar, addressbook, online storage as well as sync services.

Bloomberg reports that Apple's earnings report later today will focus on Mac and iPod sales which make up for 75% of the company's revenue. Despite the prominent iPhone 3G launch last week, those sales fall outside the reporting window for today's earnings. In addition, the supplies of iPhones that were sold during this past quarter will not be reported upon until next quarter:

Supplies of the original version of the iPhone dwindled in May as Apple prepared the updated 3G model. Sacconaghi estimates that Apple shipped 715,000 iPhones in the quarter before running out. Because new software that was promised as a free upgrade wasn't available until July 11, those shipments won't count as sales until later, Apple said in April.

So, iPhone-weary readers may be spared extensive iPhone coverage during today's financial results. Despite the extensive media focus on the iPhone, one portfolio manager clarifies that "the Mac is the primary reason [they] own Apple shares". He specifically cites accelerated growth in Apple's PC business over the past few years.

Apple is predicted to have experienced 36% growth year-over-year from last year's revenue and will be webcasting their official financial results at 2pm PT/ 5pm ET on Monday, July 21st.

Amidst the rocky .Mac to MobileMe transition last week, Apple made one other mistake that it is now apologizing for. Apple had been preauthorizing charges up to 121 GBP to European customers who signed up for a free MobileMe trial. For debit accounts, this preauthorization charge may actually remove that amount of money from the customer's available balance. Apple is working on reversing those preauthorizations and sent out new apology letters to those customers.

Dear MobileMe Member,

Apple has identified and resolved an issue that caused an incorrect, temporary authorization hold of 121 GBP to be placed on your credit or debit card when your MobileMe trial account was created. We have addressed the issue and want to apologize for any inconvenience.

Typically when you create a new trial account, your credit or debit card is verified by authorizing a small charge (equivalent to USD $1). Unfortunately, an error caused the incorrect amount to be preauthorized for your card. Be assured that this is not a charge, but only an authorization hold. The hold is released by the card-issuing bank after a predetermined period, usually between a week and a month. Where possible, Apple is working to have these holds removed earlier.

To show our appreciation for your continued loyalty, we have extended your free trial period by 30 days. This extension is in addition to the 30-day extension of which you were notified on July 16, for a total of 120 days of free MobileMe service.

Look for the extension to be reflected in your account settings in the next few weeks. You may now enjoy MobileMe free of charge until [November 8, 2008], after which your annual paid subscription will begin.

Thank you for being a MobileMe customer.

Sincerely,
The MobileMe Team

Apple is now offering those affected an additional 30 days to their trial service above and beyond the original 30 day extension for the rocky transition. As a result, affected users will get a total of 120 days of free trial MobileMe service before they are required to start their subscription.

MobileMe is Apple's new $99/year service which replaces .Mac and offers customers web-based email, calendar, addressbook, online storage as well as sync services.

As noted on DaringFireball.net, Apple's popular Remote iPhone application adds a useful and unpublicized feature to your Apple TV - a keyboard.

The Remote App [App Store] is a free download from the App Store and runs on both the iPhone and iPod Touch. It adds remote control capabilities for both iTunes and your Apple TV through your local Wi-Fi network connection. For the Apple TV, it acts primarily as a media browser, allowing you to browse and playback both music and video.

However, if you navigate to YouTube Search or iTunes Store search on your Apple TV itself, this keyboard will appear on your iPhone or iPod Touch and allow you to wireless type in your search terms. This is a much nicer alternative than selecting letters individually with your television remote.

Apple released the Remote App as a free app alongside the iTunes App Store. Apple announced that over 10 million apps had been downloaded during the first weekend after the App Store launch.

Signs are starting to appear that Apple may be prepping for a revision of their Mac laptops in the near future. Following up a previous Commercial Times report that pointed to a Q3 (July-September) order for MacBook displays, the paper now reports that Apple has increased its order of "notebook-use printed circuit boards" by 20% this quarter.

Meanwhile, Apple has notified Best Buy that they would have limited MacBook shipments over the next two weeks. While retail inventories alone aren't typically an accurate predictor of Apple product refreshes, combined with these other reports it may be more suggestive.

Apple has been rumored to be working on new aluminum MacBook Pro designs that will adopt features of the current iMac and MacBook Air. Intel's recent Montevina introduction also provides Apple with suitable processor upgrades to power new laptops.