Apple announced results for the July-September quarter (Q3 in calendar quarters). The iPhone unit sales exceeded most expectations and reached 14.1 million units. The unit sales had remained flat for the previous three quarters at about 8.4 million to 8.75 million and obviously the 14.1 million level is a record for Apple.
As to market share, 14.1 million units gives Apple roughly a 20% market share in smartphones, a huge jump from 13% in the previous quarter and exceeding Apple’s previous peak market share a year before of 17%.
If previous patterns hold, and Apple only continue to release one new iPhone model per year, then this level of sales of about 14 million iPhones per quarter would mean annual sales of about 45 million for the full calendar year 2010. Counting back 12 months (as the July-September quarter is Apple’s fiscal fourth quarter), Apple has sold 40 million iPhones in the past year, a big number.
There are several significant milestones that happened this quarter. First of all, most obviously, Apple passed RIM for the first time ever, now that the iPhone outsold the Blackberry for this quarter. Do recall that RIM also grew sales for this past quarter, and RIM has been growing unit sales every quarter quarter-on-quarter, so if the previous pattern holds, and Apple sales are now going to be flat for the next 3 quarters, RIM may claw back its lead and return to being the second-biggest smartphone maker around Q1 of 2011. But Apple’s current lead over RIM is considerable so its unlikely RIM could jump back to second place during this current ‘Christmas’ Quarter of October to December.
Secondly, less obviously, Apple achieved a major milestone in quarterly sales. Yes, it passed the 10 million smartphone unit sales level per quarter – by a wide margin too – but more relevantly, three years ago in 2007 the July-September quarter was the first full quarter of iPhone sales. So the iPhone has only been sold now for 12 full quarters (3 years). And the original sales target for the iPhone for its first year, was to sell 10 million iPhones (something that I believed in, and obviously something that happened). Now just three years later, Apple sells over 10 million iPhones per quarter. That is impressive.
There is another milestone that the 14.1 million level achieves. It is that Apple has now achieved the level of selling ‘more than half’ of the biggest smartphone maker, Nokia. Nokia sold 26.5 million smartphones in the third quarter, and has in the past sold so many more smartphones, that the second biggest smartphone maker (which for the past four years has been RIM) never sold half the level of Nokia. Now Apple has achieved that level and is obviously closing on Nokia, even as Nokia too is growing unit sales.
WHO IS BIGGEST COMPUTER MAKER?
Looking a bit beyond just mobile phones, Apple also is gobbling up market share in personal computers. Apple does not break out the iPod Touch unit sales, but analysts suggest the iPod Touch sales levels have been at about 60% of the level of iPhones. So we could estimate that for Q3 the amount of iPod Touch’es sold was about 8.5 million.
When we add 4.1 million iPad sales and 3.9 million Mac PCs, we get to a combined 30.6 million personal computers of any kind, if smartphones are included in the definition of computers sold. Bear in mind, that is how all of the big 6 PC makers now define the smartphone, that it is a computer. So where just three years ago Apple wasn’t even in the top 5 biggest PC makers if only counting the Mac sales, this quarter’s performance in computer sales would give Apple an annual level of about 122.4 million computers sold – thats twice the level of what the world’s biggest computer maker, Hewlett-Packard sold worldwide last year! Even Nokia making only smartphones cannot now match the quarterly performance of computers of all kind, sold by Apple. The difference is that clever bit of niche marketing Apple did with the market positioning of the gadget they introduced to us as the iPad.
Now, this is the milestone moment for Apple in Q3, it is not the actual final count for the full calendar year 2010 (they may get that too, but we won’t know until Q4 numbers are reported). As of now, going forward, Apple is the world’s biggest computer maker and will be so over the next 12 months. Whether it actually achieves that during calendar 2010 remains to be seen, but Apple is so far ahead of HP, that if we use the reasoning that smartphones are computers, and by that logic for calendar year 2009, Apple was third biggest behind HP and Nokia, this year definitely Apple has grown bigger than HP in making computers (congratulations!). Not bad as a come-back by those guys who made the original Apple PC all those decades ago, and who were counted by many as utterly dead as computer makers when they were producing quarter after quarter of losses in the 1990s, or whose market share in computers was counted as about 3% as recently as 2006. Must be a sweet feeling over there in Cupertino, the come-back kids, eh? Also a sense of irony, that Apple dropped ‘computer’ from its corporate name only three years ago, to then re-emerge and become the planet’s biggest computer maker..
A bit moment for Apple. And regardless of exactly when the full-year numbers will tell the story, from this point on, Apple is definitely the world’s biggest computer maker, where with Macs, iPads and iPod Touch’es helping the iPhone outsell Nokia branded smartphones and computers – and both giant smartphone makers dwarfing HP, Dell, Acer and other more PC oriented computer makers. Congratulations Apple the world’s biggest computer maker, and for passing RIM to take second place in smartphones in only 3 years from launch – and selling more smartphones now in one quarter, than they did in their first full year – that itself a world record launch of a new branded mobile phone at the time.