Apple (NASDAQ:AAPL) seems to be on a tear with its iPhones and iPads selling well. Thursday, they added another new product to their lineup – the new Mac Pro, and it also seems to be off to a fantastic start.
The Mac Pro line has always been Apple's high-end desktop computers aimed at graphics and video professionals, but the new model astounded the technical world with its revolutionary design. The old aluminum tower (approximately 2 foot by 2 foot by 8 inches wide) has been replaced by a sleek, black-coated mini-keg just 9.9 inches tall and 6.6 inches across. And into this, they have one of the most powerful desktop systems you can buy with not one but two high-end graphics cards. It achieves its small size by outsourcing mass data storage to external expansion units via six super fast (20 Gb/s) Thunderbolt 2 ports.
The new design is the first major upgrade in many years, the aluminum tower configuration having been originated in the PowerPC processor days. There is nothing like it in the marketplace, not just in design but also in specifications. Perusing both HP (NYSE:HPQ), and Dell sites, I was unable to come up with any reasonable comparative systems. The HP site in particular was hampered because it did not seem to give the user the ability to configure their systems. Still, from what I could see in the various server lines, the Mac Pro was very competitive in terms of price to performance ratio.
HP itself has been on the rise. On Dec. 4 it hit a 52 week high over $28, more than double its low of last December. Driving this has been its announcement on Nov. 26 of quarterly EPS of $1.01, slightly beating expectations. The company just awarded CEO Meg Whitman with a 50% raise to $1.5 million.
It seems as though the professional community has been waiting eagerly for the release, because they are now backordered. At about 8:30 EST, Tech Crunch reported:
The ship date for that super custom build is listed simply as "January," but stock configurations are expected to be in the mail by December 30 according to current estimates.
But by noon Apple was reporting delivery in February – even for the standard builds. Apparently, they are quite popular.
Apple promotes the fact that the units are manufactured in the USA, assembled in a plant in Austin, TX. Bloomberg notes:
Apple executive Phil Schiller said in October that more than 2,000 people in 20 states were working on the Mac Pro.
On sales projections they continue:
The new Mac Pro will probably contribute less than 1 percent of Apple's sales in 2014, said Gene Munster, an analyst at Piper Jaffray Cos. He predicts the company will sell 1.1 million Mac Pros in 2014, compared with 300 million iPhones and iPads.
This is small only compared to Apple's overall sales. Base price for 4-core and 6-core systems are $3,000 and $4000, respectively, but a computer alone can be maxed to $9,737 (including keyboard and mouse). Even without peripheral storage and monitors, it seems an average selling price will be closer to $5,000, and sales of 1 million would bring in $5 billion in revenue.
Overall Mac ASPs are expected to drop somewhat as the new MacBook Pros have reduced prices on entry level models compared to last year. Next year, the new Mac Pros may reverse that trend. Surely, the innovative new design and the incredible technology used will boost sales.
Apple has once again asserted itself as a leader in innovation with the new Mac Pro, in its visual appearance, its technical design, and its price to performance ratio. It tells the creative community that Apple has not turned its back on what was once, in Apple's darkest days, its core support group. Apple has come a long ways since then, and the Mac Pro is one more exciting product that is keeping it on the top. While it may not add so much percentage wise, it keeps up the word of mouth promotion by a very key group of professionals who tend to have a great deal of influence on others. This leads to an improved perception of Apple with everyone across the product line.
To my mind, this adds to an optimistic view of the company.