After Apple's (NASDAQ:AAPL) last earnings, the headlines started pouring in: The days of iPad growth were over. In the first calendar quarter of the year, iPad sales slid 13%, while the number of iPad units sold saw an even steeper 16% decline. Both numbers were below expectations, while iPhone sales surpassed Wall Street estimates.
The message Wall Street noted: While the iPad has had a nice run, its heady growth days are over, and Apple remains a company whose results are driven by the iPhone.
That's probably an accurate assessment. After all, iPhone revenue was $26 billion last quarter versus just $7.6 billion for the iPad. Yet, on a recent tour to Silicon Valley, Fool analysts Eric Bleeker and Max Macaluso stopped by a company whose product is built to become a central part of the kitchen, a place where the iPad reigns supreme.
The Orange Chef is a small company based out of San Francisco. It started with the Chef Sleeve -- basically, a plastic bag to cover your iPad in the kitchen -- and has moved onto the Prep Pad, an iPad-connected scale that gives feedback on the nutritional content of your food. Now it wants to be known as the connected-kitchen company.
Apple has said that 50% of iPads are used in the kitchen. It's an ideal setting for the product; increased screen size is helpful while reading recipes or watching cooking videos. In addition, thousands of cooking apps make the iPad a powerful tool for helping prepare meals.
The Orange Chef is particularly intriguing because it shows the hardware innovation that can quickly occur -- their product took just six months between design and shipping to initial customers -- between tablets and new home products. The usefulness of these products, in turn, makes tablets more valuable. It's your classical virtuous cycle, and an example of how products like tablets are still in an early enough stage that a quarter or two of disappointing sales might not reflect their sales potential years down the road. The way we use tablets, both at home and work, is still something consumers are adapting to.
Right now, Orange Chef is a private company that has raised about $3 million in venture funds; but the speed at which it has managed to develop and put to market these products, as well as its partnership with Williams-Sonoma (NYSE:WSM), makes it a fascinating company to watch as it continues to develop new products.
Fresh from their trip to San Francisco and Silicon Valley, Motley Fool tech bureau chief Max Macaluso and senior tech analyst Eric Bleeker discuss the potential of Orange Chef in the video below.
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Eric Bleeker, CFA has no position in any stocks mentioned. Max Macaluso, Ph.D. has no position in any stocks mentioned. The Motley Fool recommends Williams-Sonoma. The Motley Fool owns and has recommended Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.