MacRumors

During today's Q2 2015 earnings call, Apple CEO Tim Cook noted that Apple Watch margins are lower than the company average, and on a followup question about those margins in the context of the Apple Watch Edition's high price, Cook commented on the inaccuracy of estimated cost breakdowns on Apple products.

"I haven't seen [them for Apple Watch], but generally there are cost breakdowns around our products that are much different than the reality. I've never seen one that is anywhere close to being accurate," Cook said. He went on to say that the Apple Watch's functionality is "absolutely incredible" with a lot of new features and innovative technology.

We haven't seen cost breakdowns on the components of the Apple Watch hinting at a possible base unit price that would reveal Apple's profit margin, but such component breakdowns are often shared by analysts following device teardowns. The iPhone 6 and 6 Plus, for example, were estimated to have a parts and labor cost of approximately $200, resulting in a 69 percent gross profit margin based on the device's $649 base selling price.

iPhone 5s component cost was estimated to begin at $199, and iPad Air component cost was estimated to begin at $274. All of these estimates, which come from IHS iSuppli, include only part costs, leaving out other expenses like research and development, software creation, marketing, and distribution, which may explain Cook's comments on inaccuracy.

According to Cook, it's "intuitive" that Apple Watch margins would be lower than the company average during the first quarter, as the first quarter of any new product is "a learning period." Cook declined to provide guidance beyond the current quarter, but Apple Watch profit margins could improve in the future as component costs drop as they do over time with any new technology.

During today's earnings call covering the second fiscal quarter of 2015, Apple CEO Tim Cook did not share information on Apple Watch sales, but there were several analyst questions on the new wearable, leading Cook to shed a bit of light on Apple's efforts to fulfill orders.

According to Cook, demand for the Apple Watch is much greater than supply, but the company is "working hard to remedy that." He said that Apple made a lot of progress on that over the past week, and was able to deliver the Apple Watch to more customers than Apple had originally anticipated.

"We're going to keep doing that," Cook said, noting that some customers would begin receiving updated info on improved shipping estimates today. Apple is "generally happy" with its efforts to boost supply and get the Apple Watch out to customers as soon as possible, and Apple Watch availability may expand to other countries in late June. "It is a new product for us. With any new product, you wind up taking some time to fully ramp."

I think we're in a good position and sometime in late June we currently anticipate being in a position where we could begin to sell the Apple Watch in additional countries. That's our current plan.

Cook said that it was difficult to gauge demand without a product in stores, and that customer response has been "overwhelmingly positive." Apple is also "far ahead" of where it expected to be from an application point of view. According to Cook, the iPhone had approximately 500 apps available at launch, while the iPad had 1,000. Apple hoped to meet or beat the iPad's 1,000 available apps at launch internally, but far exceeded that with 3,500 available apps. "We couldn't be happier about how things are going from that point of view."

Cook noted that Apple is "learning quickly about customer preferences between the different configurations" and that the company will be making adjustments to get in line with demand.

Apple today announced financial results for the second fiscal quarter and first calendar quarter of 2015. For the quarter, Apple posted revenue of $58 billion and net quarterly profit of $13.6 billion, or $2.33 per diluted share, compared to revenue of $45.6 billion and net quarterly profit of $10.2 billion, or $1.66 per diluted share, in the year-ago quarter.

Gross margin for the quarter was 40.8 percent compared to 39.3 percent in the year-ago quarter, with international sales accounting for 69 percent of revenue. Apple also declared an increased dividend payment of $0.52 per share, payable on May 14 to shareholders of record as of May 11. The company currently holds $193.5 billion in cash and marketable securities.

In addition to the increase in the dividend payment, Apple said it will once again expand its share repurchase authorization to $140 billion from $90 billion and the company says it expects to spend over $200 billion in cash under its capital return program by the end of March 2017. Since the start of its capital return program in August 2012, Apple has returned over $112 billion to shareholders, including $80 billion in share buybacks.

Apple sold 61.2 million iPhones during the quarter, up from 43.7 million a year earlier and a new March quarter record, while Mac sales were also strong with 4.56 million units sold, up from 4.1 million units in the year-ago quarter. iPad sales were down, however, falling to 12.6 million from 16.35 million.

“We are thrilled by the continued strength of iPhone, Mac and the App Store, which drove our best March quarter results ever,” said Tim Cook, Apple’s CEO. “We’re seeing a higher rate of people switching to iPhone than we’ve experienced in previous cycles, and we’re off to an exciting start to the June quarter with the launch of Apple Watch.”

Apple's guidance for the third quarter of fiscal 2015 includes expected revenue of $46-48 billion and gross margin between 38.5 and 39.5 percent.

Apple will provide live streaming of its fiscal Q2 2015 financial results conference call at 2:00 PM Pacific, and MacRumors will update this story with coverage of the conference call highlights.

Conference call and Q&A transcript is after the jump

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Apple will report its financial results later this hour for the second quarter of the 2015 fiscal year, a three-month period spanning January through March that directly followed the holiday shopping season. Apple has offered guidance of between $52 billion and $55 billion in quarterly revenue, while the average of all analysts combined forecasts the company's revenue during the quarter marginally higher at $56.84 billion.

Philip Elmer-DeWitt at Fortune has compiled a pair of charts that aggregate all predictions by independent and professional analysts for Apple's revenue, EPS, gross margin and number of iPhones, iPads and Macs sold during Q2 2015, and it's believed that Apple will report double-digit growth year-over-year as sales remain strong and the company's momentum continues in 2015.

Amateur analysts are bullish, predicting average quarterly revenue of $58 billion and sales of 60.1 million iPhones, 13.6 million iPads and 4.7 million Macs, while professional analysts remain more conservative with an average estimate of $55.69 billion quarterly revenue and sales of 55.7 million iPhones, 14.2 million iPads and 4.6 million Macs. Apple is also forecasted to have a gross margin of 39.4% based on the average of all analysts.

MacRumors will be providing live coverage of Apple's financial results as they are reported around 1:30 PM Pacific (4:30 PM Eastern), including the subsequent earnings conference call with CEO Tim Cook and CFO Luca Maestri at 2 PM Pacific (5 PM Eastern). At that time, we'll have a clearer picture of just how well Apple managed to perform in the quarter.

DisplayMate Technologies has extensively tested the Apple Watch's flexible OLED display and shared the results today based on several categories, including screen reflection, brightness and contrast with ambient light, color gamut with ambient light, and viewing angle variations. Overall, the company found the Apple Watch to have an "excellent smart watch display" with accurate colors and picture quality.

In a side-by-side comparison with the iPhone 6 display, the display calibration company found that Apple has taken measures to ensure that the Apple Watch display has the same colors, color calibration and color accuracy as the larger smartphone screen. The stainless steel and gold Apple Watches with sapphire crystal displays, however, have much higher reflectance in ambient light and mandatory automatic brightness control to preserve battery life.

"Since the Apple Watch is often used right next to the iPhone 6, Apple has gone to considerable lengths to give them the same colors, color calibration, and color accuracy. The two most significant differences (other than size) are the much higher Reflectance of the Apple Watch with a sapphire crystal (8.2 percent compared to 4.6 percent), and the aggressive Brightness control using a mandatory Automatic Brightness Ambient Light Sensor in order to increase the running time on battery for the tiny watch."

The full-length report offers a comprehensive look at the Apple Watch's ion-strengthened and sapphire crystal displays, and reiterates that enhanced sapphire, which lowers the screen reflectance of sapphire to be much lower than glass, will soon be available for use in smartphones, smartwatches and other mobile devices. Additionally, DisplayMate's previous tests of the Samsung Gear 2 and Sony SmartWatch 2 displays provide good comparisons to the Apple Watch.

Apple today seeded the second beta of OS X 10.10.4 to developers, approximately a week and a half since releasing the first 10.10.4 beta and nearly three weeks after releasing OS X 10.10.3 with the Photos for OS X app to the public. Alongside the new developer beta, Apple also released the first public beta version of OS X 10.10.4.

Developers can download the new beta, build 14E11f, through the Software Update mechanism in the Mac App Store or through the Mac Developer Center.

OS X 10.10.3 introduced several consumer-facing changes including the new Photos for OS X app, a redesigned emoji picker, new diversified emoji, and more, but OS X 10.10.4 appears to be an under-the-hood update that brings performance enhancements and bug fixes.

The first two updates to OS X Yosemite, OS X 10.10.1 and OS X 10.10.2 were also minor behind-the-scenes updates that improved performance through bug fixes and enhancements.

Apple today added the NBC Sports Live Extra channel to the Apple TV, adding to its growing collection of available sports apps the device. The NBC Sports channel on the Apple TV delivers videos and clips of sporting events that air on NBC, much like the iPad app.

NBC Sports on the Apple TV offers video on demand that includes access to video clips, previews of upcoming events, and highlights from past events, plus it offers live NBC Sports events and full event replays. While video clips and other content will be available to all users, watching live content will require a cable subscription and authentication to log in.

In addition to the Stanley Cup Playoffs and Triple Crown, Live Extra streams all live sports content televised by NBC, NBCSN and Golf Channel, including: the Summer and Winter Olympics; Sunday Night Football and NBC's NFL pre-season and post-season coverage; NHL regular-season games; the PGA TOUR, including the FedExCup Playoffs, and the LPGA; the Premier League; studio content surrounding many of the aforementioned properties; original programming such as The Dan Patrick Show and Men In Blazers; and much more.

NBC Sports joins a slew of other sports-oriented apps on the Apple TV, including WatchESPN, MLB.tv, NBA, NHL GameCenter, Major League Soccer, WWE Network, 120 Sports, Tennis Channel Everywhere, and more.

Apple today seeded the second beta of iOS 8.4 to registered developers for testing purposes, two weeks after seeding the first iOS 8.4 beta and nearly three weeks after releasing iOS 8.3 to the public. Today's beta is also the first iOS 8.4 beta to be made available to public beta testers.

The beta, build 12H4086d, is available as an over-the-air download and through the iOS Developer Center.

iOS 8.4 introduces an all-new Music app, which has a revamped design that shows pictures of artists in the Artists view and offers personalized playlists. It includes a new MiniPlayer, a redesigned look for "Now Playing," global search capabilities that make it easier to search within the Music app, and a streamlined design for iTunes Radio to bolster music discovery.

The first iOS 8.4 beta had a long list of bugs associated with the new Music app, and it's likely that today's update fixes several of those issues to make the app more stable.

iOS 8.4's redesigned music app comes ahead of the rumored debut of a revamped streaming music service that could make an appearance at the Worldwide Developers Conference in June. The upcoming streaming music service is said to be similar to Apple's existing Beats music service, but with a rebranding, a redesign, deeper integration into iTunes, and a focus on exclusive content.

What's new in iOS 8.4 beta 2:

Missing music bug - Several users are reporting that installing iOS 8.4 beta 2 caused them to lose all of their music installed on their devices. Those who have lost music are not able to reinstall it by syncing via iTunes, but going to Preference --> Music --> and turning on "Show All Music" has solved the problem for some users with missing music.

Trending Search - When searching for a song on iTunes Radio using the new global search feature, a list of trending searches is displayed.

Fixes - According to the release notes, Apple has addressed a number of issues from the first beta, including resolving a crashing Music app when used with CarPlay, adding search back to the iPad version of the App Store, and fixing problems with MFi GPS accessory support. The company has, however, yet to address most of the many Music apps bugs documented in the first beta, as they remain listed in the release notes for the new beta.

Many customers who pre-ordered the Apple Watch over the past two weeks and received an extended shipping estimate of 4-6 weeks or later should receive the wrist-worn device earlier than expected. Apple continues to update several pre-orders with improved delivery estimates, with some Apple Watch orders initially slated for June delivery now shipping as early as this week.

A growing number of users within the MacRumors discussion forums with Apple Watch pre-orders facing June delivery are beginning to receive more specific shipping dates between mid May and early June. Some customers, for example, have delivery estimates of May 14-May 20 or May 28-June 10, and the white 38mm Apple Watch Sport in particular is set to deliver on April 28 for multiple customers.

The timing of deliveries is highly dependant on the model that customers selected, as the Stainless Steel Apple Watch with Link Bracelet and Space Gray models continue to face long lead times, and Space Black models are virtually nonexistent. Apple is still processing many of the orders for those aforementioned models, with delivery estimates remaining at 4-6 weeks or later for many customers.

Apple Watch pre-order deliveries began on April 24 as scheduled, but limited data from Slice Intelligence estimates that only about one-fifth of customers who pre-ordered received their Apple Watches on launch day in the United States. The report, based on e-receipt data from only 10,744 U.S. Apple Watch buyers, extrapolates that only 376,000 of 1.7 million pre-orders were delivered over the weekend, with another 547,000 watches estimated for delivery between April 27 and June 11.

Apple confirmed last week that many Apple Watch pre-orders will arrive sooner than expected, shortly after an executive relations spokesperson said that elongated shipping estimates were set purposefully to avoid disappointment in the event orders were not fulfilled on time. Nevertheless, the company said that some customers still face long lead times, particularly those who did not place an order until several hours after pre-orders became available.

Discover announced on Monday that it will enable Apple Pay support for credit and debit cardholders at eligible financial institutions in the United States this fall. Discover will also support in-app purchases made using Apple Pay on compatible iPhones, iPads and Apple Watch.

Discover customers with an iPhone 6, iPhone 6 Plus, or iPhone 5 or newer paired with an Apple Watch will be able to add their credit and debit cards to the mobile payments service to make contactless payments at thousands of participating retailers and vendors throughout the United States. Discover cardholders will continue to receive current benefits, including Cashback Bonus and Freeze It security.

“As the mobile payments landscape matures, Discover remains committed to giving cardmembers secure options for using their cards and mobile devices,” said Diane Offereins, Discover’s president of payment services. “Discover’s focus on simplicity and value for our cardmembers aligns well with the way Apple Pay makes purchases easy and convenient.”

Apple Pay became available last October in the United States with support from several major credit card companies, including Visa, MasterCard and American Express, and it was reported last December that the mobile payments service supports cards that make up over 90% of purchase volume in the United States. With the addition of Discover, that figure will rise even further.

With the launch of the Apple Watch on Friday, the first wave of consumers have received their Apple Watches. Our forums are abuzz with activity surrounding Apple's newest device. While there were initial concerns about the Apple Watch's battery life, reports seem to indicate that the Apple Watch, itself, has no problem lasting a full day.

However, there have been mixed reports about the impact the Apple Watch has on iPhone battery life. The Apple Watch needs to be paired to an iPhone for full functionality. The iPhone connects to the Apple Watch via Bluetooth and Wi-Fi to feed it data and notifications throughout the day.

Some users have found a notable improvement in iPhone battery life with the addition of an Apple Watch. This suggests the act of offloading notifications and quick interactions to your Apple Watch, could make your iPhone battery last much longer.

However, several other users have noticed a significant drain on their iPhone batteries in early usage with the Apple Watch.

Former Engadget editor Ryan Block had as similar experience and pinpointed the Apple Watch Companion app as the culprit. John Byrne also puts some blame on the Companion App, saying that force-quitting the app seemed to help at least a bit. A discussion thread in our forums provides similarly mixed results, with one user blaming his battery drain on checking email on the Apple Watch. Due to the inconsistency in reports, it seems that either a software bug or particular usage pattern could be a culprit.