Q3 Financials Completely Ignored The Retail Stores

July 23, 2014

For the first time in recent history, Apple’s announcement of its quarterly financial results did not include details about the retail stores, and a one-hour conference call made absolutely no mention of the chain at all. It also appears the company will no longer report the number of store visitors–the figure was missing from the financial filing for the second quarter in a row. Significantly, Apple said it will open just 20 new stores during fiscal 2014, the lowest number since 2002, the second year of the chain. Two-thirds of those stores will be outside the United States. During the usual one-hour conference call with financial analysts yesterday, chief financial officer Luca Maestri didn’t spend the usual 30 seconds providing details about the stores, including profit, number of visitors, number of stores opened during the quarter, and average revenue per store. Financial analysts also ignored the stores during the conference call, and focused their questions on the details of Q3 and the upcoming quarter. It wasn’t clear why the usual conference call sequence was changed, but the retail store time seems to have been spent on a two-minute summary of the quarter by CEO Tim Cook at the beginning of the conference call.

In fact, the stores reported revenues of $4.01 billion for the third quarter of fiscal 2014, not a record but in line with previous Q3 results. Other details about the store had to be gleaned from the today’s filing with the federal Securities and Exchange Commission (SEC), which showed the stores reported a profit of $711 million, about average for Q3.

Capital expenditures for the stores during the quarter totaled just $35 million, a record low since 2005, reflecting seasonal construction schedules, but also some other unknown situation.

Overall, Apple reported revenues of $37.4 billion, a record for any third quarter, and a profit of $7.7 billion. Sales of the iPad declined during the quarter, but sales of Macs were up by 18 percent compared to Q3 2013, in contrast to falling sales of PCs.

Beyond the new stores, Apple said in its financial filing that it will remodel 15 stores during the fiscal year.

Review the full financials for the retail stores.

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