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Analyst: WWDC Keynote Software Focus No Surprise

Analyst: WWDC Keynote Software Focus No Surprise

by , 4:30 PM EDT, June 11th, 2007

Wall Street may have been disappointed that Apple CEO Steve Jobs did unveil a surprise new product during his WWDC keynote on Monday, but Piper Jaffray analyst Gene Munster felt Mr. Jobs delivered exactly what he expected. The lack of a surprise product announcement underscored Apple's focus on highlighting features in the upcoming Mac OS X 10.5 release.

Mr. Munster commented "Apple is first and foremost a software company, and the common element of the company's most successful products is superior software."

Investor disappointment with Mr. Jobs's keynote reflected in the company's stock. After opening at US$126 this morning, Apple stock closed down for the day at $120.19.

Mr. Munster, however, is looking towards the impact Leopard's October release will have on the Mac and iPod maker. The late-year release will likely act as a catalyst for market share gains starting in the December 2007 quarter.

He also noted that the total number of iTunes users is substantially higher than previously thought since Mr. Jobs noted that Windows users have downloaded the software more than 500 million times. "This suggests that there are more iTunes users than we had previously thought," he said. "We did believe there were about 130 million iTunes users and now believe that number is closer t200 million."

Integrating Boot Camp into Mac OS X 10.5 is also a critical feature. Leopard users won't have to deal with a separate download and installation of the PC emulation software, making it easier to use that the public beta that is available today.

Mr. Munster added "Now, prospective Mac buyers do not have to answer the question "Mac or PC?" because Macs with Leopard will be the only computers that make it simple to run both OSX and Windows."

Mr. Munster is maintaining his "Outperform" rating and $160 target price for Apple stock. Apple is currently trading after hours at $120.25, up 0.06 (0.05%).


If you are interested in Apple's stock, join our forum members in the Apple Finance Boards, a moderated forum for Apple Investors and people who are interested in Apple's financial dealings. For other stories regarding Apple's stock activity, visit our updated Apple Stock Watch Special Report.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:Guest
Subject:

Mr. Munster commented "Apple is first and foremost a software company, and the common element of the company's most successful products is superior software."

That's because the iPod's software wasn't done by Apple.

Close Name:Sir Harry Flashman Posts: 792 Joined: 08 Feb 2007
Subject: Happens a lot

Quote
Guest wrote:
Mr. Munster commented "Apple is first and foremost a software company, and the common element of the company's most successful products is superior software."

That's because the iPod's software wasn't done by Apple.


A lot of of software companies buy software that was originally done by someone else, and often improve on it.

Close Name:Bosco Posts: 1002 Joined: 03 Jun 2002
Subject: Overestimates user count

This number has to include update downloads as well. I know they have Software Update over there, but more often than not, I end up on the QuickTime download page when it detects a new version. A more reliable and meaningful number is the number of iPods (Apple TVs, iPhones) sold. Combine with songs and videos sold on iTunes to get a useful stat that will mean something over time.

Close Name:Terrin Posts: 414 Joined: 29 Jan 2006
Subject:

Yes, it was only done by former Apple software engineers.


Quote
Guest wrote:
Mr. Munster commented "Apple is first and foremost a software company, and the common element of the company's most successful products is superior software."

That's because the iPod's software wasn't done by Apple.

Close Name:Guest
Subject: iPod software was done by Apple

iPod software called iTunes was done by Apple. Who do you think it was done by? Some fairy godmother? However they bought licenses to use the technologies that are included in iTunes. But the software was developed by Apple exclusively.

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