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Apple’s 2011: iPad Bigger Than Macs, And Yet The Mac Is Growing

Apple's Q1 2011 financial results are both unsurprising and, quite frankly, incredible. We all expected Apple to post record, blockbuster sales and revenue figures after the holiday season; yet, seeing the numbers on Apple's official press release is a completely different story. Apple sold more than 7 million iPads in the last quarter, 16.2 million iPhones and more than 4 million Macs. Apple's iPod business is "in decline" with 19.4 million iPods sold, but the iPod hasn't been Appel's main and only mobile business for four years now.

Raw numbers and revenue aside, what really comes as a surprise is the fact that the iPad, a 9-month old device belonging to a market segment basically still unexplored by other competitors, is outselling MacBooks and generating more revenue than the MacBook business itself. MacBooks (MacBook Pros, Airs and the standard MacBook) have been Apple's flagship products for more than a decade. The iPad had been in the works for years before actual release, but came out to the public in April 2010. The tablet is now beginning to be "more important" to Apple than any other new product that was out for less than 12 months in the past. Today's financial results, in fact, point out that the iPad generated $4.6 billion in revenue, with Mac computers (iMacs, Mac Minis, Pros and server line included) generating $5.4 billion. But if we look at MacBook-only sales (and MacBooks are way more popular and attractive to the average Apple Store first-buyer than desktop machines) we can see how they "only" generated $3.7 billion in revenue. Since April 2010, the iPad has become bigger than MacBooks.

Nearly 15 million iPads were sold in 2010, 14.8 million units to be exact. Impressive. What's even more impressive though, in my opinion, is how Apple is finding itself in the following situation: has there ever been, in Apple's history, a new product geared towards a new market that generated so many sales and revenue in less than a year? A product that may as well skip the usual 12-month release cycle and wait until September with Apple only releasing software updates until then? Think about it: the iPad is doing great, and there is a huge market of possibilities (read: new customers) still waiting out there. People are buying the first generation iPad as we speak. And they sure will keep doing this from now through April.

Yet, Apple will release a new iPad come April. That's how they roll. But for the first time in years (decades, dare I say), we have a new product here that in spite of all the initial doubts and debates (no Flash, no cameras, no USB) is doing exceptionally well. The iPad, without a doubt, is a first in so many ways. Feature-wise, market-wise and revenue-wise.

Still, Apple doesn't like to think of this success as a terrible cannibalization over Mac sales. Sure, some kind of cannibalization is happening, but it "feels very good" according to Apple COO Tim Cook. The iPad is selling more than MacBooks but wait -- the Mac business has been growing 8 times faster than the overall PC market. So what do we have here? A tablet device doing better than a decade-long business that, still, is growing better than anyone else. It's a win-win for Apple, basically.

With iPads doing so great, Mac business slightly cannibalized but still growing and MacBooks now behind the tablet (at least in the last quarter), one may wonder what's next. We always do. Take the new MacBook Airs, for example: Tim Cook said there has been strong demand for the new models, and they are doing well as a "starting block". Some speculate we'll see other sizes become available in the future, and I would really like to a 15-inch MacBook Air, personally. But then again, the MacBook Pros would seem to be left behind, and Tim Cook did actually kind of tease at SSDs in the next generation of MacBook family. I don't see the MacBooks Airs and Pros merging into a single line anytime soon, considering how both lines have been doing so far -- especially since the latest MacBook Air redesign.

Apple's numbers are impressive, and the iPad is clearly the winner of 2010. A new product that sold more than anyone predicted, and a device that created a market of its own. A market that's still to be explored by Google, HP and Motorola, to name a few. On the other hand, the Mac didn't report such amazing numbers but has been growing nonetheless.

Interesting times we're going through: the new takes over the old, but the old keeps doing great.

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