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Apple Inc Q4 2009 Earnings Call Transcript
Author: 123jump.com Staff
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Last Update: 5:26 PM ET October 20 2009

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Apple Inc fourth quarter sales rose 25% to $9.87 billion and net income rose 46.5% to $1.67 billion or $1.82 a share.


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No, you go ahead.

Tim Cook

Frankly, I think that, that people are really just trying to catch up with the first iPhone that was announced two years ago, and we''ve long since moved beyond that.

Mike Abramsky - RBC Capital Markets

Were you pleasantly surprised at the sort of mix of 3GS versus 99 and did that kind of, what did that tell you perhaps about the value proposition of Apple and how that drives kind of iPhone going forward?

Tim Cook

As I indicated before, the 3GS, the demand for the 3GS did exceed our expectation and we quickly changed our orders and for components, et cetera that, are different between the models. I think it shows that there''s an intense appetite for Apple''s latest technology and we were very pleased with the results.

Mike Abramsky - RBC Capital Markets

Okay, thanks, Tim.

Nancy Paxton

Thank you, Mike. Could we have the next question, please?

Operator

We will hear with Shannon Cross with Cross Research.

Shannon Cross - Cross Research

Hi, thank you. Could you talk a bit about the Mac business, the channel inventory levels, what the mix has been now that you''ve had a couple of, you know, a few months since the refresh of your lineup on the portable side?

Tim Cook

Sure, Shannon. This is Tim. Last quarter was the quarter of the portable. Up 35% year-over-year compared to IDC at 9% and so we really had a blow out quarter for portables, and it''s the result of the lineup that we announced in June and as you know we had backlog entering the quarter on that line. Also, the Mac was helped by the back-to-school, which was the strongest back-to-school we had ever had, as Peter talked about, and the launch of Snow Leopard, which occurred later in the quarter, and so there was a group of things that came together to push us to a level above 3 million, which was beyond our own expectations internally, or even some of our stretch targets.

From a channel inventory point of view, we started the quarter between three and four weeks. We ended the quarter between three and four weeks. And to be specific on the inventory change, so there''s no misunderstanding, the inventory changed less than 15,000 units from beginning to end. And so, we had very minor growth, particularly when you compare that to the growth in sales from a sequential point of view.

Shannon Cross - Cross Research

Great. And then, just any idea of the penetration of Snow Leopard right now out in the installed base? I think you mentioned, you expect, Peter mentioned fewer shipments of box sales in the coming quarter. But any idea where you''re at?
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