Apple Posts Record Revenue and Profit but Disappoints Analysts
Apple posted revenues of $28.7 billion and a net profit for the quarter of $6.62 billion. This being the last quarter of their fiscal year, Apple’s annual revenue was an astounding $108.25 billion with a new profit for the year of $25.92 billion. This is a real milestone for the company as it is the first $100-billion year. I remember when Apple was struggling to do $5 billion. These are simply spectacular numbers, especially if you consider that just one year ago the company posted their best year ever with $65 billion in sales and $14 billion in net profit.
Apple has over $81.5 billion in cash and marketable securities and posted gross margins of over 40%. While Apple’s revenue is driven by a combination of their business units—with iPhone, iPad and the iTunes Store being huge contributors—Apple shipped a record 4.89 million Macs during the quarter, an increase of 26% over the year-ago quarter. Quarterly iPhone unit sales reached 17.07 million, up 21% from the year-ago quarter, and the company also sold 6.62 million iPods during the quarter.
Mac sales were off the charts and well beyond expectations and predictions. iPad sales were about spot-on predictions; however, iPod and iPhone sales were below analysts’ estimates. I think the iPod numbers will continue to decline as more and more iPhones and iPads, which allow you to have your music on a multiple-function device, are sold. The introduction of the iPhone 4S did depress sales a bit going into the last part of the quarter, however, the new iPhone 4S has already smashed record sales. I know that we have sold through all of our initial allocation in a blink of an eye and supplies are now a bit constrained.
The Mac sales numbers were higher than the last holiday season and a 27% increase over the same quarter last year. Apple’s numbers for computer sales are four times the growth rate for PCs in general.
Apple gave guidance for their first quarter of expected revenue of $37 billion and earnings per diluted share of $9.30. This is very strong guidance, and Apple has an exceptionally strong product line going into the holiday quarter.
These financial results are very strong in a down economy, and the fact that Apple did not exceed the guesses of some semi-informed Wall Street analysts does not take the shine off of these spectacular results. Apple is firing on all cylinders, and the legacy of Steve Jobs will be that Apple continues to prosper and provide us with tools that give us the most precious gift of all: time. Congratulations to Apple on another record-breaking quarter!