from and what does Tim Cook see in the next 12 to 18 months."
ADDRESSING PRODUCTION RUMORS
In an unusual move for Apple, which typically does not respond to speculation, Cook addressed the production cutback rumors at length on the conference call and questioned the accuracy of rumors about its plans.
Media reports earlier this month said the company is slashing orders for iPhone 5 and iPad screens and other components from its Asian suppliers.
"Even if a particular data point were factual, it would be impossible to accurately interpret the data point as to what it meant for our overall business, because the supply chain is very complex," he said, adding that Apple has multiple sources for components.
"Yields might vary. Supplier performance can vary. The beginning inventory positions can vary. There's just an inordinately long list of things that would make any single data point not a great proxy for what's going on," he said.
Apple's initial iPhone and iPad mini sales were hurt by supply constraints, but Cook expects supply to balance demand for the iPad mini this quarter. He also acknowledged that iPad was cannibalizing its high-margin Macintosh computers, but said it was a huge opportunity for the company.
"On iPad in particular, we have the mother of all opportunities here, because the Windows market is much, much larger than the Mac market is," he said. "And I think it is clear that it's already cannibalizing some."
In another departure from tradition, Apple intends to tweak the way it both reports results and publishes forecasts.
Apart from breaking out results from China, the company also will no longer provide a single revenue or gross margin outlook. From Wednesday, it began providing the range it expects to hit, rather than the often-ludicrously conservative estimates that Apple was once notorious for.
The new policy took many by surprise.
"Before people could always ignore the guidance," said Dan Niles, Chief Investment Officer of AlphaOne Capital Partners, LLC. "Apple is telling investors that they need to pay attention to the guidance and you can't ignore it, which is basically what we all did in the past."