MAC TREAT #167 Update

Apple posted revenues of $28.7 billion and a net profit for the quarter of $6.62 billion. This being the last quarter of their fiscal year, Apple’s annual revenue was an astounding $108.25 billion with a new profit for the year of $25.92 billion. This is a real milestone for the company as it is the first $100-billion year. I remember when Apple was struggling to do $5 billion. These are simply spectacular numbers, especially if you consider that just one year ago the company posted their best year ever with $65 billion in sales and $14 billion in net profit.

Apple has over $81.5 billion in cash and marketable securities and posted gross margins of over 40%. While Apple’s revenue is driven by a combination of their business units–with iPhone, iPad and the iTunes Store being huge contributors–Apple shipped a record 4.89 million Macs during the quarter, an increase of 26% over the year-ago quarter. Quarterly iPhone unit sales reached 17.07 million, up 21% from the year-ago quarter, and the company also sold 6.62 million iPods during the quarter.

Mac sales were off the charts and well beyond expectations and predictions. iPad sales were about spot-on predictions; however, iPod and iPhone sales were below analysts’ estimates. I think the iPod numbers will continue to decline as more and more iPhones and iPads, which allow you to have your music on a multiple-function device, are sold. The introduction of the iPhone 4S did depress sales a bit going into the last part of the quarter, however, the new iPhone 4S has already smashed record sales. I know that we have sold through all of our initial allocation in a blink of an eye and supplies are now a bit constrained.

The Mac sales numbers were higher than the last holiday season and a 27% increase over the same quarter last year. Apple’s numbers for computer sales are four times the growth rate for PCs in general.

Apple gave guidance for their first quarter of expected revenue of $37 billion and earnings per diluted share of $9.30. This is very strong guidance, and Apple has an exceptionally strong product line going into the holiday quarter.

These financial results are very strong in a down economy, and the fact that Apple did not exceed the guesses of some semi-informed Wall Street analysts does not take the shine off of these spectacular results. Apple is firing on all cylinders, and the legacy of Steve Jobs will be that Apple continues to prosper and provide us with tools that give us the most precious gift of all: time. Congratulations to Apple on another record-breaking quarter!

Last week, “*Razoo,*”:http://www.razoo.com/ an online fundraising portal, released an “*infographic of recent study results*”:http://social.razoo.com/2011/10/apple-users-are-more-generous-than-pc-users/ showing that Apple users gave more in charitable donations through their site than Android and PC users.

The infographic is broken down into average donation by operating system, mobile device and medium (email and social media sites) as well as conversion rates for donations from email, Facebook, YouTube, Twitter and StumbleUpon. While we enjoyed seeing these results, and while we know there are a number of factors driving them, we were not surprised by Razoo’s findings because we witness the generosity of Apple enthusiasts on a daily basis.

As Don and Jan have discussed in “*previous issues of Kibbles & Bytes*,”:http://blog.smalldog.com/kibbles community involvement through charitable giving is an important part of Small Dog Electronics’ triple bottom line of people, planet and profit. Charitable giving at Small Dog Electronics happens three primary ways: through donation matching, direct donations and employee volunteerism.

*Donation Matching:* If you’ve made a purchase on our website, you’ve probably noticed the option to add a charitable donation in increments of $10.00 in the “*shopping cart*.”:https://checkout.smalldog.com/cart The Small Dog Electronics Charitable Giving Committee reviews and selects charitable organizations for which Small Dog Electronics will match customers’ donations up to $200 per customer and up to our set annual level of charitable giving. Our “pet charities” to which we match customer donations include “*Amnesty International*,”:http://www.amnesty.org/ the “*Vermont Foodbank*,”:http://www.vtfoodbank.org/ “*Puppymillrescue*”:http://www.puppymillrescue.com/ and more. Through matching our customers’ donations, Small Dog Electronics contributes over $10,000 each year to charitable organizations.

*Direct Donations:* Small Dog Electronics also provides direct donations to requests from charitable organizations whose missions meet the following criteria:

* Involved with work to improve the environment
* Provide support for gay/lesbian/transgender issues including AIDS research
* Provide support for children’s and women’s issues including protecting the rights of reproductive freedom
* Work for human rights, especially in Third World countries
* Animal rescue groups

In addition, Small Dog Electronics supports a number of Vermont-based non-profit organizations via direct donations.

*Employee Volunteerism:* Each Small Dog Electronics employee is encouraged to work one paid day a year in their community providing service. Recent employee service includes clearing trails with the Catamount Trail Association, playing bingo with residents at a local nursing home and helping area residents and businesses clean up post-Tropical Storm Irene.

Charitable giving–whether it be of money or time–is a central part of Small Dog Electronics’ mission and culture, and we are grateful that so many of our customers join us in this commitment by generously contributing to our pet charities.

“*Click here*”:http://www.smalldog.com/charity for more information on Small Dog Electronics’ Charitable Giving program and pet charities.

I have lots of chores to catch up on this weekend but Sunday seems like a good day to hop on the motorcycle, so I am planning on riding up to Brunswick Springs in Northeast Vermont.

This is the site of seven mineral springs that are considered sacred by Native Americans. There is an amazing story around these springs that you can read by “*clicking here*.”:http://www.vermonter.com/brunswick-springs.asp

Thank you for reading this issue of Kibbles & Bytes!

Your Kibbles & Bytes team,
_Don, Kali & Stephanie_

Class it up with the Canon imageCLASS LBP-6000 Monochrome Laser Printer. Honestly, I think laser printers are awesome. I use one at home to quickly (and cheaply) print out drafts and other papers that don’t need color.

The imageCLASS LBP-6000 Monochrome Laser Printer is on special this week–for one week only as an exclusive for Kibbles & Bytes readers–so check it out. Grab one for just $99.99 with a free USB cable. You’ll save $20, and shipping is just $4.99!

_Dear Friends,_

Twenty-eight hours of traveling later, I am back in the Green Mountains and the dogs were the only ones awake when I got home at about 2AM. It is hard to believe that I started the day in Hong Kong on the other side of the planet.

I had a productive trip to Miami and then to Hong Kong and into China to Shenzhen and Dongguan. The trade shows were crowded, and it is a bit like searching for a needle in a haystack to find innovative products and sort out which companies are the manufacturers of unique products and which ones are simply brokers.

One of our responsibilities is to visit the factories of the companies we purchase from to verify working conditions and assure that we have a personal connection at these companies. It is also the best way to separate the fly-by-night traders from the true manufacturers of goods.

You will be seeing some new products from “*Chill Pill Audio*”:http://chillpillaudio.com/ and “*Hammerhead*”:http://www.hammerheadcase.com/ over the next several weeks that are a result of this trip. I want to thank our man in China, Simon Liao, both for his hospitality and his diligence in assuring that we are only purchasing quality products from companies that will stand behind the goods.

I have had a couple of customers question why we source products in China. I understand the sentiment, and believe me I would love to source products here in the USA; however, it would not be possible to be price competitive, as the manufacturing center of the world is now in China.

Many of the factories in China remind me of factories in the USA in the ’50s and earlier. The production lines in the factories I visited are clean and well ventilated, and while the work appears monotonous to me, the workers seem to be happy. Most are younger workers who stay in the dormitories near the factories and send much of their wages home to their families. I think that as we see the middle class and standard of living rise in China, the demand for higher wages will also impact the manufacturing base there as well.

I saw newspaper articles while I was there that talked about how inflation and higher wages are forcing manufacturers to move production to other Asian countries such as Vietnam. We look around the world–and especially in the USA–for new products, but the reality is that most manufacturing of commodity products is not competitively done in the USA.

It is good to be back in Vermont where the trees have already lost most of their leaves and the smell of fall is definitely in the air. I am thinking about snow tires and putting the motorcycles up for the upcoming winter, but there is always time for one last ride if the sun shines.

October is National Breast Cancer awareness month, so we’ve put together two special bundles this week for Kibbles & Bytes readers. Save $20 when you purchase a Pink Diamond Aura Case for iPod touch (4G) or Purple Aura Case for iPhone 4/4S (AT&T) plus a set of Pink Chill Pill Mobile Speakers and ROXY by JBL Reference 230 Earbud Headphones in Orange/Pink–$45.99 + $4.99 shipping! $1 from the sale of each bundle will be donated to the Breast Cancer Research Foundation, which funds breast cancer research and awareness projects around the world.