Retail Sets New Financial, Visitor Records

Apple’s retail stores set new sales and visitor records during the last three months of 2007, helping to contribute to the company’s record $9.6 billion in sales and $1.58 billion in profit. The company also announced that it would expend its relationship with Best Buy to sell computers at their electronics stores. The stores generated $1.7 billion in revenue for the first fiscal quarter of 2008, up 52 percent compared to $1.11 billion for the same quarter of 2007. The stores tallied $405 million is what Apple calls “segment margin,” or profit, compared to $89 million reported for the same quarter of 2007 (reported using different rules). Mac unit sales at the stores jumped 63 percent during the holiday shopping quarter, from 308,000 in Q1 2007 to 508,000 in the current quarter. The number of visitors increased dramatically, from 28 million in 2007 to 38.4 million during the last quarter, up 37 percent.

During a question-and-answer session on a conference call, COO Tim Cook said the company was “thrilled” with the Best Buy results, and agreed to expand Apple’s presence in the stores from the current 286 stores, to 600 stores over the next six months. Under the agreement, selected Macintosh computers are displayed within Apple-branded spaces inside the Best Buy stores.

Right now there are about 9,500 storefronts selling Macs, up from 7,700 last year. There are about 2,500 outlets for the iPhone in Europe, and about 2,100 in the United States (AT&T and Apple retail stores).

CFO Peter Oppenheimer said the retail stores gave over 300,000 personal training sessions, a new record.With an average of 201 stores open during the quarter, average per-store sales were $8.5 million, compared to $6.7 million in the same quarter of 2007.

The stores contributed about 17.7 percent of Apple’s revenue, 25.6 percent of its profit, and 21.7 percent of its Macintosh sales. Oppenheimer said the “over 50 percent” of Mac buyers are new-to-Mac, the same figure he’s been reporting for the past several quarters.

During a conference call, Apple executives did not name any previously unknown store locations, although he did mention Beijing (China). Oppenheimer said that 35 to 40 stores would open before September 30th, and that more international stores would open this year than last year.

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