7 Million iPhones (Almost)

In the quarterly financial reports for the three-month period ending in September, Apple reported the sale of almost seven million iPhones. In the quarter Apple sold more smartphones than Research in Motion, maker of the popular BlackBerry devices. To put this accomplishment in heightened perspective, the 3G iPhone went on sale for the first time 11 days into the start of the September quarter. Actual reported unit sales of the iPhone in the September quarter totaled 6.892 million units.

At press time Apple has exceeded its calendar year 2008 goal of 10 million iPhones sold.

The Mac Attack Continues

In the September quarter, Apple also reported the sales of 2.611 million Macintosh computers, representing a 21 percent increase in unit shipments over the prior year period. While the sales results signal a slowing in the pace of Macintosh sales growth to a more sustainable pace moving forward, the numbers also illustrate the growing popularity of the Mac on college campuses across the United States.

Apple’s New Math

Apple reports revenue for the iPhone and the Apple TV using a deferred revenue model that recognizes revenue and manufacturing expense over the anticipated two-year life of the product. Using the deferred revenue model under GAAP (Generally Accepted Accounting Principles), Apple is pushing recognized revenue and earnings into future periods. To explain Apple’s new math, the company is reporting results using GAAP and non-GAAP methods to highlight the company’s strong sales and earnings performance. Apple is taking this step presumably to close the gap in understanding of how well the company is currently performing relative to product popularity and sales.

We won’t detail the intricacies of deferred revenue accounting in this column. It’s enough to say each iPhone sold today will benefit the company’s reported revenue and earnings for the next two years, representing the anticipated useful life of the product.

The Numbers

For the three-month period ended September 27, 2008, the company reported GAAP revenue of $7.9 billion and earnings of $1.14 billion or $1.26 per share. Using non-GAAP methods, the company realized revenue in the quarter of $11.68 billion and earnings of $2.44 billion. The difference in the GAAP and non-GAAP measures will be realized over the next two years as the deferred revenue from iPhone and Apple TV sales are added to future quarter GAAP results.

Fall Forward—The Portable Mac Update

In October, Apple updated its full line of portable Macs while introducing a MacBook at $999 in a traditional white enclosure. The new line of laptops have aluminum unibody shells and sport beefed-up graphics sub-systems.

Presumably, the new graphics sub-systems are in line with the increased role the graphics processor will play in Snow Leopard, the pending upgrade to Mac OS X which will be big on performance improvements rather than the gains in features seen in previous Mac OS X releases.

Our November Issue

Each month the editors of ATPM strive to bring you interesting news and reviews that enhance your personal computing experience. Thanks for joining us again this month.

Our November issue includes:

FileMaking: Incremental Progress

Charles Ross returns to expand upon a database for tracking books, utilizing many of FileMaker’s features.

MacMuser: Less Than Stimulating Simulation?

After lamenting the release of Feral Interactive’s ToCA game, Mark Tennent has some things to say about the disappearance of FireWire from Apple’s latest MacBook.

Next Actions: Master List for November

Ed Eubanks Jr. updates his master list of GTD applications.

Photoshop for the Curious: File Format Fever

O to struggle against great image file formats, to meet these choices undaunted (with apologies to Walt Whitman).

Desktop Pictures: Little Rock

Reader Zac Stivers provides this month’s desktop pictures from Little Rock, Arkansas..

Cartoon: Cortland

The story of Cortland has reached its final chapter, and artist Matt Johnson touches on his plans for a future comic in ATPM.

Review: Mask Pro 4.1.2

Building intricate layer masks in Photoshop can be tedious work, but does Mask Pro live up to its name for streamlining the process?

Review: MX Revolution

A fine, but overpriced, wireless optical mouse for right-handers that relies on quaint, proprietary wireless technology instead of the now-ubiquitous Bluetooth.

Review: PDFPen and PDFPen Pro 4.0.1

A promising product to help the journey toward a paperless office.

Review: StoneLoops 1.0.7

A challenging game of strategy with modes suitable for both casual and serious play.