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Recession hitting Apple retail stores hard

updated 04:00 pm EST, Wed January 28, 2009

Needham on Apple Stores

The global recession is having a serious impact on Apple's retail performance, says Needham & Co.'s Charlie Wolf. The researcher claims that while Apple Stores have for years done better than most retail chains, visitors per store fell 1.8 percent year-over-year in December, while same-store revenues dropped 17.4 percent. Mac shipments are said to have slid an average of 17.5 percent, while combined non-Mac revenues fell 10 percent.

Sales are unlikely to resume normal levels, says Wolf, until the worst of the recession is over. Apple Stores are believed to be instrumental in luring Windows users to the Mac however, due to a combination of free after-sales services and paid teaching sessions; Wolf observes that nearly half of the 515,000 Macs sold in stores during the December quarter were bought by people from a Windows background, in turning representing nearly 25 percent of all converts from Windows during the period.

The decline of same-store figures is also believed to be affected as much by Apple's rapid expansion during 2008, which lessened the average take for each location.




by MacNN Staff

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Comments

  1. starwarrior

    Joined: Dec 1969

    -6

    This guy is an Idiot

    Same

  1. VinitaBoy

    Joined: Dec 1969

    +3

    Another "Fact" . . .

    . . . from Kimberly-Clark, proving that the recession will affect EVERYONE, not just Apple's retail stores:

    "The recession has turned bad enough that people bought less toilet paper--about 5.5% less last quarter in the U.S., according to Kimberly-Clark Corp. Chairman-CEO Tom Falk, who today blamed the economy for disappointing fourth-quarter earnings and a weak forecast for 2009."

    Take that for what's it's worth (but don't think TOO much about it)!

  1. lkrupp

    Joined: Dec 1969

    0

    Wait it out...

    Why do you think Apple has something like $26 Billion in cash now? They are in excellent shape to wait this recession out. Other tech companies only wish they had Apple's position.

  1. Flying Meat

    Joined: Dec 1969

    +1

    Agreed

    The numbers presented on their own somewhat disappointing. Comparative "analysis" across similar storefronts would make the article much more useful.

  1. vasic

    Joined: Dec 1969

    +5

    Meanwhile MacD rakes in!

    For some, recession is good. Macdonalds is raking it in, as people scale down their dining out and instead eat junk rather than at another restaurant, diner or similar.

    All junk food chains are posting major increases in revenue. Sad, really...

  1. gor3don

    Joined: Dec 1969

    -3

    re: Meanwhile

    It is McDonalds, not MacDonalds.

  1. testudo

    Joined: Dec 1969

    -3

    Re: Meanwhile

    Recessions also work out for repo men.

    If your point is "Oh, with a recession, less people can afford Macs and will be stuck buying a windows PC instead" then that is probably true.

    But that's a bed Apple has decided to sleep in, as they deem low-priced computers to be beneath them.

  1. chas_m

    Moderator

    Joined: Dec 1969

    -1

    Relative to what?

    The article is useless -- utter drivel -- without comparisons from similar-demographics type stores.

    How are Bang & Olufson, Williams-Sonoma, Sharper Image, Brookstone et al doing these days? If they're doing as badly (or worse) than this is simple journalistic bias against Apple. If they're doing significantly better, THAT could be indicative of some need for strategy or management change.

    Call me when the author finishes journalism school and understands the basic principle of "compare and contrast."

  1. iphonerulez

    Joined: Dec 1969

    +2

    Apple retail stores

    are doing a lot better than Circuit City retail stores if that's any consolation. Hasn't Sharper Image gone out of business?

  1. fritzw1957

    Joined: Dec 1969

    +1

    Evidence at store...

    In a quick conversation with a friend of mine who works at the Buffalo Walden Galleria Apple Store, confirmation of the recession was pointed out to me, although it only seemed to me that at the time business was good with a number of sales going out the door last night. I was only there to pick up my copy of iLife '09 (plenty of 'em on hand BTW)

    But my friend said that the numbers were down from the year prior.

    lkrupp has it right... Apple is plenty able to ride out this recession.

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