Five reasons why Apple has ended reporting sales of Mac, iPhone and iPad units


Unlike other large consumer electronics companies, Apple has a long quarterly sales unit sales and revenue figures for its main product category. This initially helped investors get a sense of how many Apple buyers were interesting with its Mac, and then began to reveal to investors how the iPod and later the iPhone reached a whole new audience. The following are reasons why this is now changing on Apple Fiscal 2019.

A crowded Apple shop

The previous article in this series outlines why Apple's change in accounting is not an attempt to hide bad news; the company will still report earnings, and Apple only provides guidance for a record holiday season this quarter. On a November 1 conference call, Apple chief financial officer Luca Maestri stated "we have the strongest ranks we have ever entered the holiday season and we hope revenues will be between $ 89 billion and $ 93 billion, new records all the time."

Even so, analysts and experts have jumped at change as a worrying development. That, by itself, explains why Apple moves to change how it works reporting its performance. But first, consider how Apple's financial reporting has evolved when the company has grown, and why.

Very detailed historical reporting of Apple sales

Over the past twenty years, the Apple business segment has reported revenues described above as a percentage of its total revenue and the reporting of sales of parallel units has changed several times. Until 2004, Apple primarily sold Macs, becoming a company, later known as "Apple Computer, Inc." report detailed net unit revenue and sales figures for four main business segments: Power Mac (including servers) and PowerBooks intended for professionals, and iMac and iBooks are marketed to individuals.

The visualization above illustrates the share of Apple's total revenue for each year. The left edge of the chart is a breakdown of 1997 annual revenues that reached $ 7 billion, the year in which Apple actually lost more than $ 1 billion. The right bank represents 2016 revenues of $ 215.6 billion: more than 30 times greater. That year, Apple earned $ 45.7 billion in net profit.

So, while visualization makes it seem like the Apple Mac business is shrinking to nothing, in fact, it goes from representing almost all of Apple's 1997 revenue for accounting "only" 11 percent of its total revenue in 2016 – Mac's uncertain growth grows became a business segment worth $ 22.8 billion.

A decade ago, Apple volunteered with an extraordinary level of sales detail in its financial statements. That doesn't stop investors from panicking; instead, they were only armed with sensationalism with data to use against the company.

Apple's quarterly report has detailed Mac unit revenue and sales by operating segments: America, Europe, Japan, Retail, and Others. Starting in 2001, the company also detailed revenue and sales of units from its new iPod, which enabled investors to understand how the product's performance was released from "Peripherals and Other Hardware."Analysts and journalists clearly benefited from the official report on the sale of Apple units. However, they were also often fixated on a series of wrong conclusions, they arrived at the wrong place

This level of detail changed in 2005 when Apple began reporting Mac sales only in desktop and portable terms. The company also added sales of iPhone units in 2007 and sales of iPad units in 2010.

In 2011 it stopped detailing the sale of Mac units by the Operations Segment (region), and in 2013 it stopped detailing the Mac category and only reported total Mac unit sales globally.

Analysts and journalists clearly benefited from the official report on the sale of Apple units. However, they are also often fixated on a series of wrong conclusions they arrive at wrong (and periodically evil) when they try to use Apple's own unit numbers against the company.

The misleading nature of unit sales reporting: Mac in Japan

One example of a wrong conclusion taken from the highly detailed Apple sales report came from Japan, which appeared to experience a 3 percent decrease in net sales and a 14 percent decline in Mac unit sales on Fiscal 2004.

However, this alarming takeaway fails to note that Apple has opened its first retail store outside the US in Japan in 2003. All Apple sales through its own retail stores are recorded as units and Retail income, rather than credited to the Operational Segment area.

So, while income and units in Japan seem to be falling, the reality is they are growing. Apple only sells increased volumes from its Mac – and iPod – to the Japanese market through its own retail store. Because the retail store is from the US, its highly transparent accounting practices have created the illusion of problems in Japan because people who do not understand the increasing complexity of Apple's global operations make mistakes, simple assumptions when reading through Apple's financial statements. for some alarming details for sensationalism to be the title.

Japan has long been an important market for Apple. But since the misunderstanding of retail growth there in 2004, the country has repeatedly been described as a big problem for Apple, especially with regard to the iPhone.

Nobi Hayashi, a journalist in Japan, notes that a local newspaper, Sankei Shimbun, creating the idea that Apple and its partner operator Softbank aimed to sell one million units there in the first year, but only reached sales of around 200,000. In fact, no company has ever announced such a goal, and iPhone sales are actually about twice what the newspaper reported.

In 2008 Yukari Iwatani Kane from Wall Street Journal found the idea that the iPhone had really failed in Japan because of the high prices and consumer apathy (sounds familiar?), based entirely on the "lost hopes" found by the research company and rumors about the million target units.

In 2009 Wired published "Why Japanese people hate the iPhone," a burning article made by blogger Brian X Chen. It's really a fake narrative including fake quotes that are associated with real people including, "bringing around an iPhone in Japan can make you look very lame." Wired then admitted that Chen's article had various problems after his "source" stated that the quote was something he never said and did not agree at all.

Apple has never officially reported quarterly iPhone numbers for Japan. However, because various "journalists" are working with "market reachers" to make false stories about how much Japan hates the iPhone, how is it not innovative enough for technology-conscious countries, and how the price is too high for anyone to buy, Apple details its income from Japan in parallel with the sale of Mac units there (as described above in Apple 10K from 2010).

Between 2008 and 2010, sales of Apple Mac units in Japan grew by 23 percent, but total revenue grew by 130 percent. Quite clearly, the iPhone is massively contributing to large growth in Japan. That public data provided by Apple did not stop a series of claptrap articles from spewing fake media narratives about Apple's miserable suffering in the Land of the Rising Sun.

Today, Japan truly represents what appears to be the highest concentration of iOS usage (vs. Android) by the installed mobile user base – peaking this year at 75 percent, compared to 65 percent in the US, according to Atlas of Devices. During the last fiscal year, Apple's revenue from Japan grew by 23 percent, higher than other regions reported by Apple.

The percentage of Japanese mobile users on iOS is higher than in Apple's country of origin. Source: Device Atlas

That means it's time for Wall Street Journal to make a new story about how Japan hates Apple's latest products so companies must offer incentive price discounts (of $ 100, or 13 percent) to mobile operators to increase sales of their iPhone XR, something very routine for other cellphone makers who aren't even news when they cut their prices to the territory of a lost leader or offer a "buy one free one" promotion.

There is no amount of detailed unit reporting that can stop these writers from creating a narrative of how Japan hates Apple and everything that makes so much that its people spend $ 21.7 billion on Apple products and services during the last fiscal year. To help visualize how big that number is: that's about half of Facebook total global income last year.

The misleading nature of reporting unit sales: the initial iPod

When iPod unit numbers began to explode in 2003, a series of analysts and experts decided that Apple had to leave the Mac because the company saw a three-digit growth in unit sales of music devices but there was no similar scale of growth on Mac – where total unit growth was reported at only 9 percent in 2004.

In 2005, earning Millennium technology experts Rob Enderle imagined that the new Microsoft Xbox 360 "could even take Apple, forcing companies to quit the PC business."

"I know many people who hope Apple will take the first option [“exit the computer business and concentrate on the more powerful accessories market”] and quit the PC business altogether to focus more on new and highly profitable multimedia product classes, "Enderle added." Most people who think like this are developers. "

Takeover is stupid, because expanded iPod sales helped drive Apple's retail efforts, which then boosted long-term Mac growth and set the stage for launching iPhones and iPads.

Even in 2005 when Enderle envisioned the end of Mac, Apple PC sales grew by 38 percent to reach 4.5 million units per year. In 2010 Apple sold 13.6 million Macs per year. Eight years later, Apple now sells 18.2 million Macs per year, although it has also created a completely new computing platform with iPad, which sold 43.5 million additional units in the same period.

Apple sales 61.7 million iPad and Mac made it the largest computer maker in the last four quarters, above HP and Lenovo, each of which sold around 57 million PCs in a shrinking market. And while the beloved Xbox installed base Enderle (both 360 and One) has floated around 50 million units, the active Apple user base installed has reached 100 million.

Apple CEO Tim Cook announced an active 100M Mac in October 2018

But fifteen years ago, without a long-term vision or clear understanding of Apple's future plans, a number of experts continued to repeat the narrative that Apple was "no longer a computer company" and therefore needed to focus exclusively on the iPod, although it clearly had no idea what what Apple does internally as well as a real understanding of what is happening in the industry. All they have is sales numbers for iPod and Mac units now, and that doesn't help them understand anything.

The misleading nature of reporting sales units: iPod late

Because the sale of smart phones that can play MP3s began to increase, many analysts and bloggers put them in their heads so that the sale of the Apple iPod would collapse and the brief period of Steve Jobs's success would eventually end. What really happened was when Apple introduced its new iPhone in 2007, the nature of the iPod was largely converted into iOS software features.

But even before Apple announced a new iPhone, David Smith from Guard wrote a premature speech 2006 "Why the iPod loses its coolness," which claims, "sales declined at an unprecedented rate. Industry experts talked about" counterattack "and about the iPod & # 39; s malaying in front Our eyes. The most terrible, Apple's signature pocket device with white earphones might be too common to be cool. "

While the annual number of iPod physical units sold by Apple ultimately declined, it didn't happen until 2009. Smith, along with various experts who gave him soundbites signaled catastrophe for Apple because sales of iPod units reported flat for two quarters after 17 quarters of growth, all obsessed with unit sales without understanding what is happening inside Apple. All they could see was a seasonal decline in iPods sold during the summer, so they wrote apocalyptic death scenarios.

Furthermore, while sales of iPod units have eased, the iPod user base that buys downloads from iTunes continues to expand dramatically mainly because all iPhones are also "widescreen iPods," something Steve Jobs articulated on the debut of a new cellphone. But technology journalists and some analysts continue to be fixated on unit number reported for stand-alone iPods and arrive at a ridiculous conclusion that is really stupid.

The iPhone and iPod touch further undermined the sale of iPod units, making more Apple money and new customers in the process

Instead of looking at the larger ecosystem for downloading iTunes and the dramatic expansion of Apple's hardware hardware, many experts grew crazy about obsessing over iPod sales as if it were some kind of substantial "bad news" that effectively erased Apple's real gains. In fact, Apple is repair selling iPod units from low-priced MP3 devices to broader and stronger iOS products that attract premium prices while leaving users more satisfied, more loyal, and more likely to return for more Apple branded devices in the future.

In 2008, Apple achieved peak sales of 54.8 million iPods, with an average selling price of $ 167. That year it sold 11.6 million iPhones at a unit price of around $ 560 each. The following year, experts who were obsessed with a one percent decline in iPod units were sold, even when iPhone units grew by 78 percent and the income they generated grew faster, by 93 percent.

Some, both shifts are related to that fact iPhone also iPod, a clear fact that facilitative analysis of scholars fails to be understood because they are seeking sensationalism rather than truly understanding the trends that occur in Apple's business. Unit sales figures do not help them understand what is happening, even when Apple feeds them per unit price in parallel.

Although the sales of its units shrank, the iPod maintained an incredible market share of 72 percent for independent music players even at the end of 2013, as reported by NPD research analyst Benjamin Arnold at the time.

However, many analysts and journalists fail to understand how Apple is very good at managing the market transition from iPod to iPhone because they are only disturbed by unit sales figures. It was as if the audience of the judges scoffed at the triathlon in the lead because he no longer made the documented progress in swimming when in fact he was now riding a bicycle far ahead of all the other contestants.

The misleading nature of unit sales reporting: iOS devices

The nature of the Apple iPhone business cycle initially produced unit numbers that declined in the spring quarter after its launch. This is widely interpreted in the most cynical way among Apple critics, who insist that quarterly fluctuations in iPhone unit shipments are a bad sign that the iPhone lost their appeal and that buyers left Apple to look for alternatives.

The same bad analysis erupted in connection with the sale of the iPad unit after the peak of the mini-fuel tablet in 2014. When Apple introduced a larger new iPhone, a significant segment of sales of small iPad units starting at $ 399 effectively shifted up in the form of large numbers Apple's new $ 750 iPhone 6 Plus.

The total number of iOS devices shot up, even if Apple's full unit report makes it seem important that branded mobile devices like the iPad "collapse," at least among writers who don't have a good understanding of what's happening in the industry.

Critics continue to take iPad sales for years. Some basically announced that tablets had finished and finished, even when Apple continued to ship the most tablets – millions of dollars per quarter – and got almost all the profits in the global tablet market. The iPad continues to remain tied to Apple Mac in generating around $ 18-20 billion in revenue each year, but simple quick retrieval based solely on unit sales figures has triggered misinformation and misleading media narratives.

The nature of unit sales reports is misleading: Mac

This fifth example is a variation of "Apple's now iPod company" bullshit in the early 2000s. A decade later, sales of Apple Mac units were dramatically overshadowed by new products: iPad.

Approaching the peak sale of iPad units in 2015, Christopher Mims published his very hot work Wall Street Journal who argue that Apple must "turn off the Mac" and "focus on products that represent the future," partly because Mac generates less than 10 percent of Apple's total revenue and "Apple doesn't need this income."

That WSJ having been blabbering over stupid nonsense for years was incredible

That year, Apple sold 20.6 million Macs resulting in $ 25.5 billion in revenue and 54.9 million iPads making $ 23.2 billion. During the same period, Microsoft's Surface division generated around $ 3.4 billion in revenue, but no major financial newspaper thinker recommended that Microsoft "give up" because mouse-based PCs represent the past, that hardware experiments interfere with its focus, or that Microsoft doesn't "need revenue" because the Surface contributes very little to its total revenue – and is a fraction of Apple Mac's revenue.

Since then, there has been a lot of pundit advice that recommends that Apple cut prices. Instead, Apple has effectively made Mac a luxury level of luxury, resulting in sales of 18.2 million Macs in fiscal 2018 while still generating revenues of $ 25.5 billion. And while iPad sales have slowed due to a number of reasons for their current figure of 43.5 million units per year, revenues there still make $ 18.8 billion this year.

If Apple has taken the advice offered by Wall Street Journal in 2015, he will hand over sales of around 56 million Macs and revenues of $ 74.2 billion, only to "focus" on mobile iOS devices that target two globally shrinking markets: smartphones and tablets. To visualize that large amount, almost 15 times what Rupert Murdoch spent to get it Wall Street Journal.

When Wall Street Journal pretending to be able to interpret rumors about Apple's global supply chain today, given the depth of his very stupid advice offered as a serious thought only three years ago, and how wrong it has been since, serving fake bucket comments under the guise of credible financial newspapers .

Hyper-scrutiny from the Apple unit, nothing for rivals

Write for Wall Street Journal Earlier this month, Tripp Mickle delivered Apple's announcement that it would stop reporting sales of units for iPhone, iPad and Mac by writing, "When Steve Jobs took swipe at Inc.'s Kindle in 2009, he pointed to the retailer's online decision not to report the sale of their reading device units as evidence that it doesn't sell much. Almost a decade later, Apple followed the same path. "

One little logic that escapes cynical scalering Mickle: no columnist or expert who has researched Amazon sales' Kindle about how the sale of Apple units has been cut, diced and turned into a pile of bad news in the past two decades. On the contrary, the Kindle is always considered a fairly successful business, despite the fact that Amazon has never released unit numbers or even income related to the e-reader business.

And despite Amazon's efforts to describe the Kindle as an "iPod book," it has never briefly achieved anything in the order of Apple's success with the iPod, while also failing to turn into another kind of success such as the iPod giving birth to Apple iPhone and Apple. Pay attention to the line. Kindle e-readers spawned a Fire Phone disaster and a series of Fire tablets that not only officially reported sales or revenue figures but were only offered at the sale price of fire.

On top of that, Amazon App Store has never turned into a commercially significant business anywhere comparable to Apple's leading global App Store.

Recently, Amazon Alexa products have been sparked with a strong type of worship that is usually provided for Google hardware. However, no company has ever given quarterly figures for units sold or revenue generated. And, that's only in retrospect that we have found that both are extraordinarily clamped which not only fail to generate hardware revenue or sell meaningful amounts, but also fail to encourage their limited user pool to Amazon shopping or various Google advertising services with what commercial meaning even.

The news came from Information, a solid decade after Amazon was allowed to falsify its success with the Kindle and then Alexa hardware with almost zero supervision from the same person who was panting about every unit Apple had ever released. Amazon was allowed to falsify its success with the Kindle and then Alexa hardware with almost zero supervision from the same people who experienced hyperventilation about every unit Apple had ever released

In addition, Mickle's stab at Apple's unit reporting changes also failed to understand that Apple would still report revenues from its hardware units and services, so it would not hide the fall in sales. That would only feed journalists less ammunition to use in shooting themselves in the legs when they tried to take wild potshots at Apple.

Nothing captures the great insult for accuracy in industry technology reporting as experts do in a number of historical iPad units. It was used to claim for years that the Apple iPad business collapsed on the brink of death even when they actually produced tens of billions of iPad sales profits for both individuals and companies every quarter for years.

IDC recently acknowledged that the iPad did lead the global tablet "inevitable" after eight years of denial trying to portray clips like the Tablet PC and Windows Phone as long-term winners. Note that neither Microsoft nor its licensors have issued quarterly unit numbers from the sale of their cellphones or tablets.

Experts got angry when Apple compared the sale of iPad units to notebooks, but no vendor lessor publicly reported the sale of their units or did not receive any supervision for it.

And at the same time, the assumptions about how great the future of Google tablets looks are despite the fact that Google failed to make a successful tablet business. When Google gave up on tablets and started dumping Chromebooks on K12 education, the narrative shifted to how devastating this was for Apple, despite the fact that the iPad was sold throughout important markets globally in much greater quantities, while Chromebooks never became popular on the real market any. outside the several million units of loss leaders given to K12.

Like Amazon, Samsung is also often equated with Apple as a tablet heavyweight, although no company has ever created a decent tablet business even comparable to Apple. And after eight years of trying to enter the tablet hardware market, Microsoft has recently received applause for selling several hundred thousand units in the US, said to make it a "top five" vendor in a market where there are only four companies selling a large number of tablets.While it's good to have Apple's unit sales report from its product category, the reality is that these figures have historically been used against companies to promote incompetent lies and analysis.

So, although it is good to have Apple's unit sales report from its product category, the reality is that these numbers have historically been used against companies to promote incompetent lies and analysis, while also giving Apple competitors valuable flows of free market data on makers the most successful hardware in the industry, competing data does not reply.

Apple stopped reporting the previous unit

Right before the launch of the Apple Watch, Apple announced it would stop reporting on selling iPod units and would not release a unit number for the Apple Watch. This resulted in handwringing among media members and various analysts, who were especially worried that they would not have a way to measure how successful Apple Watch was.

Apple has not reported sales of units for the Apple Watch, just like all watch competitors

Many jump to the conclusion that Apple does not have high expectations for new products that can be worn, or a very good prospect for entering the smartwatch business – which already has a set of established vendors, including Samsung, Fitbit, Pebble, and a series of Google Android Wear partners , including when Google's child Motorola was accused of promoting wearable Android. Of course, no vendor has ever published quarterly unit sales from their smartwatch.

Preliminary data shows that Apple does not sell enough watches, or be beaten on the market by low-priced devices, only based on estimated unit shipments. But again, the reality is that Apple has created premium products that effectively attract an enthusiastic audience. In just a few years, Apple Watch has destroyed all the real potential for alternative smart watches and has even begun to destroy the larger market for luxury watches.

Instead of "hiding" the sale of its units, Apple focuses on detailing revenue trends related to Other Hardware as a group, and regularly notes specifically the health and growth that can be specifically imposed. Outside of the Apple Watch, Apple has also never released quarterly unit numbers for AirPods. That doesn't have an impact on AirPods to be very successful but prevents competitors from getting access to valuable data where Apple invests its innovative capital.

At the same time, media talk about the fall of the iPod was greatly reduced because there was no official unit number for experts to obsess over and unconsciously blow up fake problems. As I mentioned earlier, not only are all iOS devices effectively becoming "iPods" in both utilities and as a base installed to encourage sales of media downloads and now Apple Music subscriptions, but Apple Watch itself is basically Apple's modern iPod, which was enhanced in ability and style, and was able to demand a much higher price.

Apple clearly does not hide the sale of internal unit units that can be used because of shame, but more because the data does not need to be published in front of its competitors and because the reporting unit numbers are likely to be interpreted with similar incompetence and dangerous cynicism displayed in the last two decades of unit reporting about Mac, iPod, iPhone, and iPad.

Apple about why it will no longer report unit data in 2019

Apple Fiscal Q1 2019, which began on October 1, will mark the first time the company will not report sales of Mac units, iPods, iPhones, and iPads, just like other hardware. In addition to avoiding sharing this data with competitors and taking unit sales from the view of critics who want to use it against companies, Apple executives have outlined other key reasons not to focus on unit sales.

In its latest conference call with analysts, Apple chief financial officer Luca Maestri noted that "the number of units sold in a 90-day period does not necessarily represent the strength that underlies our business."

In other words, rather than "hiding the number of units sold," Apple's real intention is to avoid hiding meaningful insights behind the total number of units sold.

Maestri separately clarified this by stating "to give you an example, the sale of iPhone units at the top of the line has been very strong during the September quarter, and that is very important because we attract customers to the latest technology and features that we bring into the lineup, but you don't need to see it on [iPhone units sold] amount reported. "

Instead of unit sales providing clear insight into Apple's business, they often distract from data that is more important about the nature of Apple's business. Historically, this was true when the sales of iPod units grew far greater than the Mac; when the iPod starts to shrink; when the iPhone is dipped seasonally; when an iPad unit is converted into an iPhone sale; when iPad unit sales surpass Mac; dan karena Apple telah menjual model yang lebih canggih dan lebih canggih daripada hanya volume perangkat dasar atau lebih murah.

Maestri menambahkan, "unit penjualan kurang relevan untuk kita hari ini daripada di masa lalu, mengingat luasnya portofolio kami dan penyebaran harga penjualan yang lebih luas dalam setiap lini produk yang diberikan."

Sekali lagi, Maestri secara efektif mencatat bahwa penjualan unit tidak semuanya sama. Penjualan satu iPhone ultra-premium bernilai lebih dari "dua unit" yang diwakili oleh iPhone low-end dan iPad mini yang terpisah. Mendefinisikan bisnisnya dalam hal penjualan unit mengaburkan salah satu kompetensi inti Apple yang paling berharga: kemampuan untuk menarik dan mempertahankan pembeli setia yang terus membeli perlengkapan baru Apple premium dan memanfaatkan langganan, layanan, aksesori, perangkat lunak dan konten lainnya, baik di skala yang tak tertandingi oleh pesaing yang mengkhususkan diri dalam "penjualan unit," dengan tujuan utama memperoleh "pangsa pasar" volume daripada membangun basis pelanggan seperti yang dimiliki Apple.

Maestri juga secara terpisah menyatakan, "jumlah unit yang terjual selama setiap kuartal belum tentu mewakili kekuatan yang mendasari bisnis kami. Jika Anda melihat pendapatan kami, mengingat tiga tahun terakhir, jika Anda melihat laba bersih kami selama terakhir tiga tahun, jika Anda melihat harga saham kami di sini dalam tiga tahun terakhir, tidak ada korelasi dengan unit yang dijual dalam periode tertentu. "

Dia juga mencatat bahwa "pesaing utama kami di smartphone, di tablet, di komputer tidak memberikan informasi penjualan unit setiap tiga bulan."

Mengenai topik pelaporan penjualan unit, kepala eksekutif Apple, Tim Cook, juga menyatakan dalam panggilan konferensi bahwa "basis terinstal kami tumbuh dengan dua digit, dan itu mungkin metrik yang jauh lebih penting bagi kami dari sudut pandang ekosistem dan pelanggan. kesetiaan, dan sebagainya. Apple tidak fokus pada volume unit yang terjual, tetapi lebih banyak volume pelanggan yang "dijual" di Apple

"Yang kedua sedikit seperti jika Anda pergi ke pasar dan Anda mendorong gerobak Anda ke kasir dan dia berkata, atau dia berkata, 'berapa banyak unit yang Anda miliki di sana?' Tidak masalah berapa banyak unit yang ada di sana dalam hal nilai keseluruhan dari apa yang ada di keranjang. "

Apple tidak fokus pada volume unit yang terjual, tetapi lebih banyak volume pelanggan yang "dijual" di Apple. A followup article will detail the reasons why, and how this changes the products Apple develops, how it differentiates them from competitors, and why it is key to understanding Apple and its future as a global brand.


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