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iPod, less profits in the December quarter?

For the first time in the history of the commercialization of the iPod the profits that derive from the player could be in decrease. This is the prediction of Toni Sacconaghi, an analyst at Bernstein Research, published yesterday. To jeopardize the growth of iPod turnover would not be a drop in sales or a decrease in its popularity, but the imbalance of the market in favor of low-cost devices, such as iPod nano and iPod shuffle, at the expense of the more expensive iPod 5G.

Sacconaghi predicts that the number of iPods sold during the quarter could go from 14 million in the same period last year to 17.5 million, but among these a large number (about 21%, at least in the US) would be iPods shuffle. This would result in a drop in the average price for each iPod sold by 22% which in turn would mean 3% less in the turnover determined by the iPod. The fact that the Apple Stores, stores where Apple takes the full price of the player, would have sold part of the sales to third-party stores, which instead earn a profit that does not go to Apple.

According to Sacconaghi a part of the investors may be surprised by this situation, but the effect on the value of the AAPL stock would end up being limited given that Apple has just announced an expensive product such as the iPhone which in the short term should completely cancel the inevitable downward trend in iPod turnover.

Another element that should reassure Wall Street would be sales of Mac computers. According to Sacconaghi, Apple would have been able to sell 1.68 million Computers, 34% more than last year, with a 30% increase in turnover. Here, too, the difference between turnover and number of machines sold would be the effect of the drop in the average price of the individual PC.

Sacconaghi's forecasts will be put to the test tonight when Apple will present the fiscal quarter result at 11 PM Italian time. According to most analysts, the turnover should be around 6.5 billion dollars with a profit close to 80 cents per share.