Apple sees another big quarter
Company once again beats expectations, pulling in $24.67 billion in revenue during its most recent quarter. It sold 18.65 million iPhones, 3.76 million Macs, and a less then expected 4.69 million iPads.
Following last quarter's Mac sales.revenues, Apple once again beat expectations led by strong iPhone and
Apple's second fiscal quarter revenue came in at $24.67 billion, or $6.40 per share. That's way above the $23.34 billion and $5.36 per share that Wall Street analysts had been expecting, and it puts revenue growth at 83 percent compared with the same quarter last year.
"With quarterly revenue growth of 83 percent and profit growth of 95 percent, we're firing on all cylinders," Apple CEO Steve Jobs said in a statement. "We will continue to innovate on all fronts throughout the remainder of the year."
Leading the way was the iPhone, of which Apple said it sold a whopping 18.65 million units, 113 percent more than in the same quarter last year. This was the first quarter to include sales of the iPhone compatible with Verizon Wireless' network, whichin February. Verizon's CEO had rebuffed reports that sales had been underwhelming. Data from a earlier this month also suggested Verizon sales had been strong, pushing the gadget to the position of top-acquired phone for that month.
And in the news most of the tech world had been waiting for, Apple revealed it sold 4.69 million iPads during the quarter. Much as Hollywood does with box office figures, Apple has a habit of announcing opening weekend unit sales, though it had stayed mum on iPad 2 numbers, with analysts pushing estimates in the 5 million to 9 million units range for the quater. This number comes well under those estimates, and does not include a breakdown of how many of the units were the iPad 2, which went on sale in early March--just two weeks before the end of the quarter.
Apple said it sold 3.76 million Macs during the quarter, representing a 28 percent growth from the same quarter last year. Included in that number is the new MacBook Pro refresh with Intel's , which was in late February. The quarter also included the second-generation MacBook Air, which had its refresh back in October.
On the decline were iPods, of which Apple said it sold 9.02 million units during the quarter, a 17 percent drop from the same quarter last year. During the company's earnings conference call, Apple Senior Vice President and CFO Peter Oppenheimer said that more than half of those units were the iPod Touch. Oppenheimer also pointed out that the company still had more than 70 percent of the MP3 player market cornered according to data from the NPD group, and that the iPod continued to be the top-selling MP3 player in most countries the company tracks.
On the sunny side of the music picture, Apple's iTunes business raked in more than $1.4 billion in sales during the quarter, up $1.1 billion from the same quarter last year. The company does not provide a breakdown of how the digital products that make up the store, like music, videos, and applications sold, so it's difficult to tell where the boost came from. During the earnings call, the company noted that it was up to 189 million iOS devices sold through the end of the quarter, no doubt helping to push digital content purchases up.
Apple said it continues to see big gains in Asia, where the company saw its greatest growth with a profit increase of 151 percent during the quarter. Oppenheimer said the company's Mac sales in the Asia-Pacific market grew 76 percent year over year, with greater China pushing sales of the iPhone up to three times previous levels.
The company's retail business, which turns 10 in May, is set to receive its 1 billionth visitor. During the earnings call, Oppenheimer said sales in Apple's retail stores were up 32 percent during the quarter, with the average revenue of the 323 stores sitting at $9.9 million. The retail stores continue to be a place where the company can increase its market share, Oppenheimer said, noting that nearly half of the Macs sold there were bought by customers who were not Mac users. Apple said it plans to open an additional 40 stores in fiscal 2011, with the majority of those being outside the U.S.
Apple's stock was going for $355.72 a share in after-hours trading.
Some tidbits from the company's conference call:
Update at 2:25 p.m. PT:
On Japan: Apple COO Tim Cook said the earthquake and subsequent tsunami were a tragedy, but as a result of the company's supply chain, there was no supply or cost impact during the second quarter. Cook said the disaster would affect next quarter's revenue to the tune of $200 million, but that's been factored into the company's guidance. Cook said that Apple sources "literally hundreds of items" from the country, including LCDs, optical drives, and NAND flash drives.
Greater China saw iPhone sales increase three times year over year. iPhone U.S. sales grew 155 percent year over year.
iPod, iPad, and iPhone combined, Apple now has just under 189 million iOS devices sold.
This is the 20th consecutive quarter Apple has outgrown the PC market, according to data from IDC.
Apple's retail stores turn 10 years old on May 19th.
Apple has 65.8 billion in cash.
On phones with 4G LTE: Cook said first-generation LTE chipsets "force a lot of design compromises" the company is unwilling to make. Cook added that the company is extremely pleased with the iPhone 4 and the iPhone 3GS.
Update at 2:40 p.m. PT:
On iPad 2 stock meeting demand: Cook said he couldn't say when the two would reach equilibrium. He did say Apple was continuing to produce a large number to help meet the "staggering" demand.
On Steve Jobs' day-to-day involvement with the company, Cook said: "We do see him on a regular basis. And as we've previously said, he continues to be involved on major strategic decisions, and I know he wants to be back on full-time as soon as he can."
Update at 2:48 p.m. PT:
Cook noted that the end of this quarter was just two weeks after the iPad 2 went on sale, and that the company produced many more iPad 2s for that launch compared with the ramp up for the original iPad. Cook said he was so confident in the company's supply chain, that Apple is making the iPad 2 available in 13 more countries next week.
Cook on why there was no breakdown of iPad 2 vs. iPad 1 units in the total sales number: Cook said "we've purposefully left it out" to keep competitors from getting an idea of how it was selling. "I wish we could have produced a lot of iPad 2s," he said.
Cook on iPad and iPhone in the enterprise leading to Mac sales: "It clearly seems to be creating a halo effect for the Mac."
Update at 2:58 p.m. PT:
Cook flung off a question about the next iPhone not arriving during its usual June time frame.
On supply and demand for other products: Cook said the iPhone is now in a supply and demand balance in almost all Apple's major markets. Same goes for the Mac and iPod. The iPad however has the "mother of all back logs," Cook said.
On the freshly filed Samsung lawsuit, Cook said Samsung was a very valued component supplier, and that he expected the relationship to continue. However, the mobile communications division had done things Apple did not like, and after attempting to talk it over with Samsung, Apple took the issue to court.