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Apple Sold So Few iPads Last Quarter That Suppliers Are Suffering (And Other Nonsense)

oyster ipadApple posted its fiscal fourth quarter results yesterday. For the period ending 26 September, Apple reported revenues of $51.5 billion with a net profit of $11.1 billion, up from $42.1 billion and a net profit of $8.5 billion.

Apple CEO Tim Cook said the growth was fueled by record iPhone sales, all-time records for Mac sales, and expanded availability of the Apple Watch.

Apple sold 48 million iPhones last quarter, generating $32.21 billion in revenue. the company also sold 5.71 million Macs ($6.88 billion in revenue) and 9.88 million iPads during the quarter ($4.28 billion). Revenue from "Services" category, including iTunes, warranties, etc, were $5.08 billion, while the "Other" product categories, including the Apple Watch and its set-top box, generated revenues of $3.05 billion.

This wasn’t Apple’s best quarter ever, but it was better than last year and Apple has socked away $206 billion (enough to buy Uber, Airbnb, Twitter, Tesla, and Netflix, and have $30 billion left over).

All in all the news is great, but someone has still somehow managed to find a negative spin on the report. PocketNow and CultofMac report that Apple’s iPad parts suppliers are suffering. Citing a Digitimes report, they note that a Taiwanese maker of backlights has had to slim down its workforce and close factories.

The slowdown is being blamed on poor iPad sales, and if that’s not the most ridiculous example of lazy tech reporting I’ve seen this month then I don’t know what is.

Ten million iPads sold (plus hundreds of millions of other tablets and smartphones), and suppliers are suffering?

That is so absurd it doesn’t even merit a response.


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jjj October 28, 2015 um 9:52 am

This is likely your most clueless post yet.

"This wasn’t Apple’s best quarter ever, but it was better than last year and Apple has socked away $205 billion (enough to buy Uber, Airbnb, Twitter, Tesla, and Netflix, and have $30 billion left over)."
– 205 was revenue , figure out what that means.

As for ipad sales, sales have been declining , ASPs have been declining (mix shifted towards smaller and/or cheaper) so if you are a supplier for ipad only your business is declining pretty hard and ofc you are hurting.

As for Apple’s results pretty much everything was rather soft. iphone sales were 46 sales plus 2 inventory and that’s down on quarter. ipad was 500k inventory down so sell-through was 10.4 million units compared to 12.8 last year (adjusted for inventory) and 14.1 2 years ago. The watch was bellow 3 million units and part of that is inventory in the channel.
Only the Mac was ok but that’s the last quarter Macs do ok since the ipad Pro will start to hurt Mac sales.
On the other hand ,many analysts feared even worse since they don’t see the new iphone being able to drive sales and for them this was good enough and they’ll just wait for iphone 7 to deliver more.

Scott G. Lewis October 28, 2015 um 10:06 am

Wait. iPhone sales are up quarter over quarter and year over year even though the 6S variant was available for about a week out of that quarter and everyone new it was coming so might have held off on a 6 purchase in the weeks prior, but it’s soft? I’m going to ignore the rest of your comments, because your analysis was so flawed.

Oh, why not. One more comment. Revenue was not 205 billion. It was 51.5 billion for the quarter. And cash on hand was reported at $206 billion. Granted that’s not $205 billion, but I’m leaning towards Nate’s analysis being a bit more accurate than yours.

Nate Hoffelder October 28, 2015 um 10:12 am

Scott, I saw the $205 billion figure used a lot on Twitter, including in titles for news articles. So I went with it.

Scott G. Lewis October 28, 2015 um 10:20 am

I’m sure it’s a rounding up vs down number. Point is… your analysis was quite a bit more on target than our commenter friend.

Even other things, like the supposition that the iPad Pro will hurt sales of the Mac. That’s EXACTLY why it exists as a product.

The iPhone supplanted the iPod for many, many people. When the iPad came out a lot of people expected some of the PC to Mac switchers to keep the PC and switch to iPad instead. The iPad Mini of course attracted people who wanted a smaller tablet and weren’t buying the larger one, but it also attracted people who were buying the larger one and wanted to switch form factors also.

One of the reason Apple has held on so long is they have no fear about cannibalizing their own sales with sales from another product line. It’s their MO. They know EVERYTHING gets displaced eventually in technology. Someone will create a new segment or new take on an existing segment. You can’t STOP the sea of change. So your best bet is to displace yourself before somebody else does.

If Mac sales are down next year and iPad sales are up because of iPad Pro, it’s a victory. If Mac sales are down, the iPad trend doesn’t trend upward, and Samsung Note Tablets shoot way up, it’s a failure.

jjj October 28, 2015 um 10:33 am

"This wasn’t Apple’s best quarter ever, but it was better than last year and Apple has socked away $206 billion "

I assumed that was revenue for fiscal 2014 but that’s actually cash and then you need to understand that all that cash wasn’t made last year.Plus most of it is offshore to avoid taxes, stuck doing nothing.

jjj October 28, 2015 um 11:13 am

Also to note that bringing that cash home would mean maybe some 70 billions tax (great tax rules isn’t it?) so the cash pile shrinks quite a bit And if you want to be a bit more accurate they also have 56 billions debt.

Scott Lewis October 28, 2015 um 5:55 pm

$205 million liquidity is $205 million liquidity. Period. The debt is there because Apple chooses to take advantage of today’s unbelievably nearly free ability to borrow money rather than pay a much higher rate to repatriate the overseas money. I do the same thing. My investment income provides a higher rate of return then it costs me to have a 4% interest rate on a mortgage. So I don’t sell assets to pay off my loan.

None of this changes your initial comment. Which was wrong, and frankly, rude. I don’t always agree with Nate but man… Let’s kee it civil.

Mackay Bell October 29, 2015 um 12:12 am

Apple is far and away the most profitable and successful company on the planet with massive profits, sales and cash reserves (and a reputation for excellence). The only way to pull bad news out of it’s latest reporting is to assume that not only should every product Apple make be successful, but it should be wildly successful with growth every year forever.

Dropping iPad sales are kind of interesting from the standpoint of consumer preferences. Are people switching to bigger iPhones? Or buying more Mac Books? Or is the replacement cycle longer, or was it possibly a fad? Or, are people waiting for the iPad Pro. In terms of Apple’s bottom line, the dip in iPad sales is pretty meaningless. The larger Apple ecosystem is growing like crazy.

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