Apple shipped its first iOS device, the iPhone, in the summer of 2007 and has not stopped since. Within a quarter, they sold over one million units. By July 2010, the company had reported sales of iOS devices to have crossed 100 million units sold, and this January, they reported sales of 160 million units. Last month, cumulative iOS device sales crossed 200 million units. To date, Apple has shipped 222 million iOS devices. Apple’s device popularity can be gauged from COO Tim Cook’s comment in the iPad2 “…we sold every iPad 2 in the quarter that we could make and so there certainly was not a shortage of demand.”
Apple is gaining market share across the globe within different market segments. Within the U.S., they are the third-largest PC seller. According to IDC Research, global PC shipments grew 2.6% over the year in the second quarter, compared to the 12% growth in the first quarter. Apple surpassed Acer to own 10.7% of the domestic PC market driven by strong sales of the iPad. A year ago, Apple commanded a 9% market share. In Europe, they recently overtook Nokia, again, this time in mobile ad impression share. InMobi research estimates that during the previous quarter, more than 2 billion ad impressions were served on Apple devices in Europe, commanding 19.5% of the Continent’s mobile ad share. The share of Nokia devices fell to 18.7% of ads in the region.
Apple’s (NASDAQ:AAPL) Q3 revenues grew a whopping 82% over the year to $28.6 billion, sailing past market expectations of $25 billion. EPS of $7.79 was also significantly ahead of the Street’s target of $5.85. This was their best quarterly performance ever, driven by strong sales of the company’s iOS devices.
During the quarter, they sold 20.3 million iPhone units and 9.25 million iPads. The market was looking for 16 million to 18 million unit sales of the iPhone and 8 million unit sales of the iPad. They expanded the launch of iPad2 in 36 more countries, and now the device is available in 64 countries across the globe. To cater to the growing demand, Apple is said to be evaluating a second manufacturing partner for iPad3. The only disappointment were Mac sales of 3.95 million units and iPod sales of 7.54 million units, which fell short of the Street’s targeted sales of 4.2 million Mac units and 8 million iPods.
iOS Devices’ Expanding Market
Meanwhile, Apple is also working on expanding the reach of the iPad within the enterprise market. They reported testing or deployment of iPads internationally in 47% of Global 500 companies. They are impressed by the way companies like Boston Scientific, Xerox, and Salesforce.com have deployed iPads within their sales teams to engage with customers.
They are also stepping up efforts to capture the enterprise smartphone market, long dominated by RIM’s BlackBerry, and are seeing results. At present, 88% of the Fortune 500 companies are projected to be testing or deploying the iPhone. comScore estimates that BlackBerry’s share of U.S. mobile subscribers fell from 8.6% last year to 8.1% in the quarter ended May 2011. iPhone’s share, however, grew from 7.5% to 8.7% in the same period.
Additionally, Apple is in talks with Sprint to add the carrier to the iPhone 5 carrier list. If the talks were to go through, Sprint would become the sole carrier with an unlimited data plan offering for the iPhone5 and could help add an estimated 45 million users to the iPhone market. The recent comScore report pegs Android-based domestic smartphone market share at 38.1% compared with Apple’s 26.6%. Apple will be looking to narrow this gap through the agreement with Sprint.
Apple’s Expanding Portfolio
Apple is also working on launch of the iOS 5 and the iCloud. iOS5 includes over 200 new features including a notification center for viewing and managing notifications without interruption, iMessage for sending text messages, photos and videos between iOS devices and Newsstand, a new way to purchase an organized newspaper and magazine subscriptions. iOS 5 is expected to be launched this fall.
The market is also looking forward to the iCloud, which will offer a set of free new services to work with apps on the iPhone, iPad, iPod touch, Mac or PC and to automatically and seamlessly store content in the cloud or push it to the devices. The iCloud is also expected to be released this fall.
Apple is rumored to be working again on Apple TV. The market is speculating that Apple is building an Internet-connected HDTV, which would help it gain presence in an additional $50 billion to $100 billion market.
Earlier this week, they updated the new OS, OS X Lion, MacBook Air and the updated Mac Minis. Mac OS X Lion is their eighth major operating system update and helps to deliver an interface and overall experience geared towards mobile computing. The new OS will be downloadable and not sold on a disk.
Priced at $999, the MacBook Air will offer higher performance because of the new Intel Core i5 and Core i7 processors. The machines will work on the new OS X Lion and will have additional features such as a back-lit keyboard and a high-speed Thunderbolt i/o port. The Wall Street Journal has already published very positive reviews for its new line-up.
Surely, this is one stock on a growth path. It is trading at $386.90 with a market capitalization of $358 billion. It touched a 52-week high of $396.27 earlier this week, with no sign of slowing down. The only damper in this story is the question mark looming over Steve Jobs’s health.