Apple Inc AAPL
Q3 2010 Earnings Call Transcript

Transcript Call Date 07/20/2010

We expect revenue to be about $18 billion compared to $12.2 billion in the September quarter last year. We expect gross margins to be about 35% reflecting approximately $14 million related to stock-based compensation expense. We expect most of the sequential decline to be due to a higher mix of the iPhone 4 and iPad sales, which have higher cost structures and provide great value to customers as well as the revenue deferral impact of the iPhone 4 case offer.

To a lesser extent, we expect the sequential decline to be driven by back-to-school promotion and the absence of the favorable adjustment that benefited gross margin in the June quarter.

We expect OpEx to be about $2 billion including about a $195 million related stock-based compensation expense. We expect OI&E to be about $50 million reflective of the short-term interest rate environment, and we expect the tax rate to be about 26.5%. We are targeting EPS of about $3.44.

In closing, we're thrilled with our record June quarter revenue and strong financial performance. We're very pleased with sales of iPad and iPhone 4. We’re working hard on catching up with customer demand for these great products and we look forward to rolling them out to even more customers and more countries this quarter.

We are very pleased with the market share gains for our iPhone, Macs, and iPod, and remain very confident in our new product pipeline.

With that, I'd like to open the call to questions.

Read our Earnings Call Transcript disclaimer.
Add a Comment
E-mail me new replies.