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TheStreet Open House

Apple Stores Mauling Microsoft: Analyst

CUPERTINO, Calif. ( TheStreet) -- Apple's (AAPL - Get Report) stores may be shrines to the tech giant's minimalist aesthetic but they are also a key weapon in its battle with Microsoft (MSFT - Get Report), according to an analyst.

The stores, which are popping up around the globe, have already lured masses of Windows users onto the booming Mac platform, Needham & Company analyst Charlie Wolf says, and continue to play a pivotal role in the clash of the two tech heavyweights.

Apple

" The Apple Stores have become a magnet in attracting Windows users to the Mac platform," explained Wolf, in a note released on Wednesday. Windows users purchased half of the 606,000 Macs sold in the stores during the March quarter, he added.

Needham estimates that, since 2004, more than 18 million Windows users have switched to a Mac.

"Mac sales in the March quarter were almost four times higher than they were in the second quarter of fiscal 2004," wrote Wolf. Windows switchers have more than doubled the size of the Mac installed base, he added.

The post-sales services offered through the "genius bars" located in Apple stores have helped woo Windows users onto Macs, according to the analyst.

Revenue from Apple's retail stores was $1.68 billion during its recent second quarter, up from $1.38 billion in the same period last year. During the conference call to discuss the results, Apple CFO Peter Oppenheimer explained that the stores sold 606,000 Macs compared to 438,000 Macs in the prior year's quarter.

"About half the Macs sold in our stores during the March quarter were to customers who have never owned a Mac before," he added.

Apple ended the quarter with 286 stores and plans to open between 40 and 50 new stores this fiscal year. Over half of the new openings will be in international locations such as London, Paris and Shanghai. Apple plans to open two stores in Shanghai this summer and aims to have about 25 stores open in China by the end of calendar 2011, according to Oppenheimer.

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