Despite the overall decline in the global PC market, Apple (NASDAQ:AAPL) managed to buck the trend with its unusually high December quarter Mac sales. Apple’s strong Mac sales were highlighted in a recent research note from Needham & Company analyst Charlie Wolf.
In a note obtained by Apple Insider, Wolf pointed out that sales of Apple’s notebooks and desktop computers surpassed growth in the overall PC market by 24.7 percent. That is the largest gap between Apple’s Mac sales and the overall PC market that has been seen in five years.
As noted by CFO Peter Oppenheimer during Apple’s fiscal first-quarter earnings call, the Cupertino-based company “sold 4.8 million Macs, compared to 4.1 million in the year ago quarter, an increase of 19 percent, making this among our best Mac quarters ever.” Oppenheimer cited especially strong sales of the iMac and MacBook Air. Last year, Apple upgraded the MacBook Air with Intel’s (NASDAQ:INTC) next-generation Haswell processor that uses significantly less battery power while offering an even higher workload capability. According to Apple, the 13-inch MacBook Air has jumped from approximately 7 hours of battery life to an “all day” battery life of 12 hours.
According to market research firm Gartner, the global PC market suffered its worst decline in history during the fourth-quarter of 2013. Per Gartner’s data, worldwide PC shipments totaled 82.6 million units in the December quarter, a 6.9 percent drop from the same quarter in the year-ago quarter. However, Apple actually gained market share in the fourth-quarter of 2013 with a 13.7 percent share, compared to a 9.7 percent share in the year-ago quarter.
The decline in the traditional PC market is largely due to the increasing popularity of tablets and other mobile devices. Apple has consistently dominated the worldwide tablet market, even as it underwent two successive quarters of share loss last year, according to data from Strategy Analytics. However, per Strategy Analytics, Apple reversed this trend last quarter with a gain of 7 percent. According to Apple, the company sold 26 million iPads in the December quarter, compared to 22.9 million in the year-ago quarter.
Although Apple achieved strong Mac sales last quarter, Wolf was unsure if the high Mac sales were a sustainable trend or “a one-quarter blip,” reports Apple Insider. “The question we don’t have an answer to is whether Mac shipment growth can overcome the headwinds of negative growth in PC shipments,” observed Wolf in a note seen by Apple Insider. “While the Mac represents a small fraction of Apple’s revenues, it nonetheless is an important barometer of the health of Apple’s ecosystem.”
The Needham & Company analyst also speculated that Apple’s iPad was more likely to cannibalize sales of Macs rather than Windows-based PCs. “Shoppers at the Apple Stores most likely consider both a MacBook and an iPad for their next purchase,” noted Wolf per Apple Insider. “The allure of an iPad is undoubtedly far greater when it is in close proximity to a MacBook than it is in other shopping venues.” Here’s how Apple has traded over the past five sessions.
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