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Technology Stocks : Apple Inc.

AAPL 278.28

+0.1%

Dec 12 9:30 AM EST

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To: Marc Newman who wrote (11926)	4/21/1998 1:18:00 PM
From: Eric Yang	Read Replies (1) of 213176

Marc...my initial impression is that a 10% quarter to quarter revenue growth may be possible since the new PB and AIO target new market segments. I don't know if this assumption will stand against more critical evaluation...I think the picture become more clear as we hear more news about AIO and Wallstreet PBs. 95M profit in Q3 seems optimistic indeed. Like you said year to year revenue growth in Q3 is practically impossible since revenue in Q3 97 was over 1,700 million. But I do feel we'll see a significant revenue growth quarter to quarter. Anderson mentioned that revenue is expected to be flat...but during the part of conference call where he mentioned this, there were so many numbers that were given it that it was really hard to keep track which ones were year-to year and which ones were quarter to quarter. This is why I think it would be great if we can get a transcript of the conference call. I've seen the various summaries by a number of Mac sites but I wouldn't trust these sources for reporting these important details accurately. It looks like the non-G3 inventory are under control. One point that Fred Anderson seem to stress upon was that Apple's inventory management has improved and will continue to improve. From what we are hearing, most of the 6500..etc are now in the channel. And the inventory in the channel has dropped by $100 mil. Much of this is probably due to the dropping average unit price though... Anyone caught the figure on what's the total value of the inventory in the channel? "I now believe you were on target when you suggested that the initial G3 margin was over 30%. I say this because even though the PowerBooks were really marked down this quarter, as well as the G3s later in the quarter, the overall margin still rose" Yeah..we did that little margin calculation thing and figured that the margin on G3s should be well over 30%. I then did a rough calculation based on the estimated that G3 will account for over 50% of total units and dropped the margin on the non-G3s to 16%...the calculation yielded a margin of 24.5%. I think non-G3s should make up 30% or less of the total unit shipment in Q3. Thus even if the margin drops further their effect on the overall margin would be reduce as well. I think it should be possible to calculate the current margin on non-G3s based on the numbers that we were given this Q. That would allow us to get a fairly accurate estimate of the overall margin for Q3 if we can estimate the G3 to non-G3 accurately. Eric

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