Key questions and answers from the second quarter earnings call conducted by Apple, Inc. (AAPL: chart) on April 25, 2007.
Could you give any Apple TV numbers at this point?
The company has gotten some incredible reviews from many different sources. The company has just started shipping on the third week in March. The management is not releasing the exact unit shipments expectations.
How do you feel about your current staffing levels ability to higher employees? Are you looking to staff up at this point?
The company has no issue at all in hiring really great people. iPod is a very revolutionary product, it uses the Mac OS, as you know, and so the company had always planned on using Mac OS resources to complete the iPhone. It is taking more time than more of resource than was thought and so the company made a choice and delayed Leopard and it thinks it is the right choice.
Could you walk through the puts and takes behind the sequential decline in gross margin. Is the component environment outlook the most important factor to hear about?
The company is guiding gross margin down sequentially, largely as a result of the commodity pricing beginning to trend up and also the beginning of the education buying season which the company sees higher purchases this quarter, typically lower at price points. And a couple weeks ago the company completely repriced its display line and that had an impact as well.
You talked about payments from Cingular AT&T. Are you getting subsidies for the phone or are you getting a percentage of the monthly service contracts that the customers enter into?
The management is not able to comment specifically. Apple will recognize payments from AT&T Cingular as revenue overtime as earned. The commodity environment last quarter was more favorable than expected, particularly in the memory area. This quarter the company sees some commodities, moving from an oversupply condition to more of a supply demand balance position, particularly NAN Flash and memory in general.
What was the CapEx for the quarter?
The company had $105 million in capital for the March quarter.
From a theory basis, if the pricing stays relatively low and you maintain the pricing of your products, could you draw the conclusion that the margin should be other than 32%?
The company sees commodity pricing trending up in June. The company is now entering the education buying season. The June quarter tends to be more dominated by K to 12 which tend to buy the lower ASP products and Apple has, in fact, repriced its deployment.
iPhone is going to come in June. Do you think that it is going to be widely available in June or is it going to be relatively a few units in June?
It is very difficult to tell what the demand is until you are actually shipping the product. There seems to be an enormous amount of people that are waiting for and talking about it, but the company needs to start shipping and make the product available for sale before it can predict demand.
Did AT&T say that they have a million orders for iPhones?
AT&T is not taking orders there. They have a million people who are interested that have find upon the right side.
Do you think you could fulfill a million in the June quarter?
The management doesn’t want to predict what its supply would be.
Could you give an update on the timing of the iPhone outside the United States? 
