The financial reports coming from Apple yesterday made me take a sharp breath, and for all the most impressive reasons. The company derided as dead during the late ’90s announced sales of $26 billion over the holiday quarter. Apple’s on a run rate to post a $100 million fiscal year in 2011. All that, plus $6 billion in profits on a lineup with few products priced over $4,000, and most less than half that.

HP had a fine quarter in its last report, announced in late November. But the company needed more than 300,000 employees to sell $33 billion and post $8.7 billion in profits. The new CEO Leo Apotheker warned that profits would take a hit on increased R&D at HP. Apple’s R&D has been built-in to its profits, at levels HP hasn’t seen in a decade. At its flashiest, HP can point to a fall tablet from its Palm labs that could deliver hardware innovation to draw people to the brand. (The Topaz renderings, at left, show a 7-inch device sporting WebOS, innovation HP bought last year, rather than built.)

Apple’s new numbers put the company within 25 percent of HP’s sales and a $3 higher profit per share. There’s something special in any computer vendor’s sauce that lets it change the rules, as with the iPad, while it cranks out 71 percent higher sales than one year ago.

But it’s the combination of innovation and integration that Apple’s COO Tim Cook talked up the most in the company’s quarterly analyst call yesterday. Read the rest of this entry »

Apple pointed to the sales of the iPhone as the primary factor in its $13.4 billion Q2 report this week. The device, which Apple sold more than 8.7 million units of, is becoming the equivalent of the inkjet cartridge at HP. High volume, high profit, and a very different product than the company has been known for. You might argue that the iPhone has little to do with the mission of the Mac. But you won’t be throwing away an iPhone every month, like those HP ink cartridges. Using an iPhone in conjunction with a Mac makes the mobile device act like an extension of the computer.

What works in Apple’s favor it that the iPhone has plenty of competition, but no direct knock-offs. It’s the Apple product most likely to introduce the company’s computer solutions to a first-time customer. The second most likely product? The Mac itself. Apple said about 300,000 Macs sold at the Apple retail stores during Q2 went to customers who had never owned a Mac before.

Apple cites a “stronger product mix” including more iPhone sales while explaining how it beat analyst estimates by more than 2 percent for margins. Then there’s the $47 billion in cash the company reported for the period ending March 31: A lot of clams to toss at whatever research and development opportunities emerge.

Apple pointed at its “first mover” opportunity with the iPad as one place where it intends to exploit its advantages with fresh investment. Apple expects to release iPad units in 9 overseas countries by the end of May and ship the 3G versions by the first week of May.

One analyst said the iPad has a chance to become “the Mac of the masses.” In the 1980s Apple called the Mac “the computer for the rest of us.” Many analyst questions during the Q2 conference Q&A covered the iPad. As of this week, one tracking site estimates more than 1 million iPads in use: An introductory rate that outstrips the adoption of the iPhone in its first quarter of sales. Perhaps what the iPhone has done for Apple is a sign of what the iPad might add in several years.

We wanted to love the new Quicken Essentials for the Mac, truly we did. Bites of Apple and several other small businesses here are run on Intuit products, from the business-worthy QuickBooks 2010 to the pocket-sized Quicken 2005. There was never much reason here to upgrade to Quicken 2007 for Mac. By then, the Mac community was feeling well and truly overlooked by Intuit.

Quicken Essentials has a chance to change that perception that is not hard to spot in the marketplace. But the release rolled out this week to the Mac community won’t be confused with a business tool soon, even though some people will still be stubborn enough to run a business using it. When we heard that Essentials was based on the new blood from Mint.com, acquired by Intuit last year, Essentials was at least worth a look.

The look of the software is one of the biggest changes from the Quicken Mac 2007 and 2005 releases. Seeing your major expenditures in a cloud presentation is cool, but only useful if there’s a wide range of spending levels. Reporting and planning tools got an update, with a nifty feature to help you plan for savings by tracking your spending. We’d use it as a cash flow estimator, but we’re full of imagination here. That’s not usually something that a finance tool inspires.

Unfortunately, Essentials has stripped away some things that worked well enough to call Quicken for Mac a very small business solution. Rapid data entry is an essential all by itself to keep your books, but Essentials reduced the number of keyboard shortcuts and added clicks. This did not quicken the financial chore for us.

Then there’s the issue of data conversion. Nobody would be caught dead re-entering data to move to a new tool, and there’s a two-step process to bring your old data forward. But in our testing, the existing Quicken for 2005 file got orphaned and unusable during our conversion. It’s a simple save-as, but Intuit hasn’t understood simple, sometimes. Read the rest of this entry »