Apple defies PC downturn again, boosts Mac sales

Mac sales climb 5% year-over-year during a quarter when industry contracts 4%

Apple on Wednesday said it sold 4.1 million Macs in the March quarter, growing sales during a period when the personal computer industry overall continued to contract.

The Cupertino, Calif. company sold 5% more Macs in the quarter than the same stretch the year before, with revenue from its oldest line accounting for 12% of the company's total sales of $45.6 billion.

"Macs continue to be very consistent, with a very consistent market," said Carolina Milanesi, chief of research at Kantar Worldpanel ComTech, in an interview after Apple's earnings call concluded.

The consistency Milanesi spoke of was Apple's ability to regularly beat the industry average for personal computer sales growth. In the March quarter, global shipments of PCs decreased by 4%, according to researcher IDC. Rival Gartner pegged the contraction at about 2%.

"It's a good business for them," said Van Baker, an analyst with Gartner. "But remember, Apple chooses to compete only at the high end of the market, so it's kind of self-regulating."

By that he meant that the Mac, unlike the bulk of personal computers, is not as susceptible to the whims of price wars, or the waning and waxing of economies. And because it was not really forced to compete on price, Apple did not have to pare margins to the bone to sell systems, as have most other OEMs (original equipment manufacturers).

"Plus, the Mac helps them sell other products and sustains their image in the market because they can put the latest technology in their machines," Baker added.

The ASP, or average selling price, of the Mac line actually increased 2% quarter-over-quarter, climbing from $1,322 to $1,344. Even so, the March 2014 quarter's ASP was down nearly 3% year-over-year.

When graphed over a long period -- from 2008 on -- the Mac's ASP looks quite stable, showing that Apple has been able both to sustain modest growth while not retreating from its premium brand philosophy.

The 4.1 million Macs sold last quarter were a March quarter record for the company. If Gartner and IDC were accurate in their estimates of personal computers shipped worldwide, Macs accounted for between 5.3% and 5.6% of the total.

The two research firms have predicted that the long-term contraction of the PC industry -- eight quarters, or two years, so far -- will continue into the foreseeable future. For instance, IDC forecast last month that total shipments will shrink by 6% this year, and volumes will remain under the 300-million mark through 2018.

The Mac's sales contraction, on the other hand, ran for only four quarters. The March quarter was the second consecutive on the plus side of the growth ledger.

Microsoft, whose Windows operating system powers most non-Mac personal computers, will report its March quarter earnings Thursday after the market closes. Microsoft's numbers, and the commentary by its executives, including new CEO Satya Nadella, should provide additional insight on the health of the overall PC business.

The Mac's ASP (average selling price) has remained remarkably stable over the last 6+ years, a tribute to Apple's focus on the high-end of the PC market. (Data: Apple.)

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, on Google+ or subscribe to Gregg's RSS feed. His email address is gkeizer@computerworld.com.

See more by Gregg Keizer on Computerworld.com.

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