Apple drops iPods from earnings report

Remember when Apple was the iPod company? Well, it is no more.

Oh, sure, Apple still sells the digital music players. And the iPod’s legacy can still be seen in the iPhone, the iPad and Apple TV. But sales of the gadgets are so meaningless to Apple now that it has stopped delineating them.

Apple’s earnings release on Tuesday marked the first time in 13 years that the company hadn’t broken out exactly how many iPods it sold or how much money it made from those sales. Indeed, in discussing Apple’s results, company officials didn’t even mention the iPod, only referring in passing to the “other” category of sales into which Apple now lumps it.

The change wasn’t a surprise to those who had been paying close attention. Apple alerted investors in its previous quarter’s earnings call that it would no longer be breaking out sales of the iPod. Instead, it said, it would include those sales with sales of its Apple TV, Beats headphones and speakers and other accessories.

And it’s not a shock that Apple would stop releasing the figures. In its fourth fiscal quarter, the last for which Apple provided iPod results, it sold $410 million worth of the devices. That represented less than 1 percent of Apple’s $42.1 billion in revenue in the period. As a financial analyst might put it, the iPod was no longer “material” to the company. The iPod has become so meaningless to Apple that the company hasn’t refreshed its lineup of devices in more than two years.

Still, the reporting change is something of an ignominious demotion for a product line that first began Apple transformation from niche computer maker to global electronics giant. In the holiday quarter of 2005, just four years after the first iPod launched, sales of the devices accounted for more than half of Apple’s quarterly revenues. In their peak year, 2008, Apple sold $9 billion worth of iPods, shipping nearly 55 million of them. By contrast, Apple’s total sales in fiscal 2001 — its last year before the iPod — were just $5.4 billion.

But the launch of the iPhone in 2007 was the beginning of the end of the iPod’s importance. It heralded a shift from in music listening from dedicated music devices to smartphones that include music players as one of their functions. Still, despite that shift, Apple continued to garner significant sales from iPods for years after the iPhone’s launch. As recently as four years ago, more than 5 percent of Apple’s total sales in the holiday quarter came from iPods. Five years ago, that figure was about 13 percent.

Since Apple began releasing figures on iPod sales in 2002 through the end of its last fiscal year, it had sold nearly 397 million of them, garnering some $67.5 billion. Not bad for a product that got a mixed reception when it launched.

Photo of Apple’s latest iPod nanos courtesy of the company. 

 

Tags: , , , ,

 

Share this Post



 
 
 
 
 
css.php