Apple profits edge higher on sales of 2.52M Macs, 22.7M iPods

[AppleInsider]

Apple said Wednesday that first-quarter profits rose a little less than 2 percent to $1.61 billion, or $1.78 per diluted share, on record sales of $10.17 billion for the three-month period ended December 27, 2008.

The results compare to revenue of $9.6 billion and net quarterly profit of $1.58 billion, or $1.76 per diluted share, in the year-ago quarter. Gross margin was 34.7 percent, equal to the year-ago quarter. International sales accounted for 46 percent of the quarter's revenue.

"Even in these economically challenging times, we are incredibly pleased to report our best quarterly revenue and earnings in Apple history -- surpassing $10 billion in quarterly revenue for the first time ever," said Apple chief executive Steve Jobs.

Apple sold 2,524,000 Macintosh computers during the quarter, representing nine percent unit growth over the year-ago quarter. The company also sold a record 22,727,000 iPods during the quarter, representing three percent unit growth over the year-ago quarter. Quarterly iPhone units sold were 4,363,000, representing 88 percent unit growth over the year-ago quarter.

In accordance with the subscription accounting treatment required by GAAP, the Company recognizes revenue and cost of goods sold for iPhone and Apple TV over their economic lives. Adjusting GAAP sales and product costs to eliminate the impact of subscription accounting, the corresponding non-GAAP measures* for the quarter are $11.8 billion of "Adjusted Sales" and $2.3 billion of "Adjusted Net Income."

"Our outstanding results generated over $3.6 billion in cash during the quarter," said Peter Oppenheimer, Apple's CFO. "Looking ahead to the second fiscal quarter of 2009, we expect revenue in the range of about $7.6 billion to $8 billion and we expect diluted earnings per share in the range of about $.90 to $1.00."

Apple will provide live streaming of its Q1 2009 financial results conference call utilizing QuickTime. The live webcast will begin at 2:00 p.m. PST today. AppleInsider will provide full coverage.

Additional coverage of Apple's Q109 release

Notes of interest for Apple's Q1 2009 financial results call
Apple TV sales rise 300%, will see continued investment
Apple rules out "iPhone nano," not keen on Mac netbook

[ View this article at AppleInsider.com ]

[amac4me]

A growth slowdown is clearly evident in these numbers. The lower guidance for the current quarter relative to the street's estimates further demonstrates that Apple has to respond to the economic backdrop.

[joe in miami]

Congrats to Apple, one of the greatest American companies left.

[macxpress]

Originally Posted by amac4me

A growth slowdown is clearly evident in these numbers. The lower guidance for the current quarter relative to the street's estimates further demonstrates that Apple has to respond to the economic backdrop.

The 2nd quarter is always Apple's hardest quarter as its after the holiday season and before the school buying season. Its a tough sell even during good times.

Apple is always very conservative with its outlook for the next quarter. You will see the stock go down because of it. Happens every time. Seems like investors would learn this!

These are pretty good numbers. I was hoping a bit more for for iPhone sales. Perhaps if Apple didn't have such as asinine system for getting one over the holidays it would have been better, who knows! The iPod sales are great! So much for the iPhone killing iPod sales.

We'll see as time goes on if Apple can continue to keep these types of numbers up in line with the quarter of a year ago. This will tell how Apple is doing during this downturn. IMO, we need to wait until we get further into the year before we can truly say Apple is immune to this downturn.

[MJ Web]

Great numbers!
No one escapes the economic slowdown.

[aaarrrgggh]

Flat year-over-year is amazing given all the doom and gloom. Q2 Estimates are for $1.13 down from 1.16, so Apple's guidance is generally on-par; it would be odd to see analysts lower estimates.

This will really put a lot of pressure on some of their "peers" and competitors to deliver this quarter.

One thing can be said though-- Apple is running an efficient ship. The margins will likely have to drop a little in the near term to move more product, but even 5% drop gives them a 30% margin...

[dreamraj]

Outstanding numbers, guys!! They've bettered year-ago quarter's "best ever" numbers consistently. And this when 2008 was supposed to be a bad year for Apple too like it was for everyone else. Hope AAPL sellers and naysayers STFU now!

[RichL]

Quarterly iPhone units sold were 4,363,000, representing 88 percent unit growth over the year-ago quarter.

Ouch. 35% fall from the previous quarter. Apple's global smartphone marketshare is going to be well down. I remember Prince McLean predicting the downfall of Nokia because their smartphone sales only rose 5% quarter-on-quarter.

Otherwise, impressive numbers in these tough times.

[cameronj]

Originally Posted by macxpress

Apple is always very conservative with its outlook for the next quarter. You will see the stock go down because of it. Happens every time. Seems like investors would learn this!

Whoops, guess not.

[Hoss]

Now seal a government contract of a Mac on every desk and donate a few million ipod touches to Kenyan, Chinese, Mexican and American schools......with some kind of education pack.

[johnqh]

Originally Posted by RichL

Ouch. 35% fall from the previous quarter. Apple's global smartphone marketshare is going to be well down. I remember Prince McLean predicting the downfall of Nokia because their smartphone sales only rose 5% quarter-on-quarter.

Otherwise, impressive numbers in these tough times.

Wrong,

6.9M were SHIPPED last quarter. Among that 6.9M, 2M were in the channel, so the sales was about 4.9M last quarter.

That also includes the pend-up demand. There were no iPhone in stock anywhere for almost a month before iPhone 3G was introduced.

[bklynkid]

Can we just get the stock price > 100 so that I can dump these?

[macxpress]

Originally Posted by cameronj

Whoops, guess not.

Check Apple's stock in after hours trading...not what it closed at. Don't get me wrong..I hope it goes up. Its just typically goes down.

[walshbj]

I thought the analysts said everyone already had an ipod...

[hiimamac]

Originally Posted by macxpress

Check Apple's stock in after hours trading...not what it closed at. Don't get me wrong..I hope it goes up. Its just typically goes down.

Indeed. Normally Apple goes down after CC or keynote, macworld.

Be cautios though, I've seen this happen before with other tech stocks, see it go up, up, up, only to have a slow dump, Th, Fri, Monday, Tue with it ending up below what it was a few days ago.

WS is a slimly bunch that loves to get LONGS from mom/pop investors (any tech stock).

[BuffyzDead]

Tim Cook: "We're not going to build a low-end voice phone. Our objective is not to be unit share leader, it's to build the world's best phone."

I stated it here at AI under another post.
Smaller technology, in a smaller form factor, Implies higher price point.

IF Apple is in fact working on a nano iPhone, with all the bells and whistles of todays 3G BUT in a smaller form factor, it will sell for $399 and up.

Tim just said as much.

[monstrosity]

Originally Posted by RichL

Ouch. 35% fall from the previous quarter. Apple's global smartphone marketshare is going to be well down. I remember Prince McLean predicting the downfall of Nokia because their smartphone sales only rose 5% quarter-on-quarter.

iPhone numbers are bound to have peaks and troughs, just wait till the next revision arrives. I also predicted the downfall of nokia. (which incidentally is already happening)

[e1618978]

I am so happy, my call options will bring me back into the green, I hope...

[FineWine]

Wow. iPhone sales absolutely cratered. On the other hand, iPods soared. Funny, I bought a 120GB Classic back in December 08. To me, it's not all that surprising. In this economy, to be saddled with the outrageous AT&T contract, is asking too much of most consumers. I have friends who got iPhones for Xmas from their wives, but I suspect sales of iPhones will keep going down. And that Andy Zack guy got it horribly wrong, sadly the pessimistic analysts were more right than he was

[JeffDM]

Originally Posted by RichL

Ouch. 35% fall from the previous quarter. Apple's global smartphone marketshare is going to be well down. I remember Prince McLean predicting the downfall of Nokia because their smartphone sales only rose 5% quarter-on-quarter.

"Prince" is overly enthusuastic at times.

Comparing sequential quarters is fraught with potential errors because most markets are seasonal. Unless you account for seasonal variations, and do a good job of it, there's not much that can be read from that, so the best way is to compare from same time previous year.

Originally Posted by BuffyzDead

Tim Cook: "We're not going to build a low-end voice phone. Our objective is not to be unit share leader, it's to build the world's best phone."

I stated it here at AI under another post.
Smaller technology, in a smaller form factor, Implies higher price point.

IF Apple is in fact working on a nano iPhone, with all the bells and whistles of todays 3G BUT in a smaller form factor, it will sell for $399 and up.

So far, Apple has been trying to price things such that bigger is more expensive, smaller is cheaper. I don't think an iPhone nano would really be a low end phone either. If anything, if there is a smaller model (though IMO doubtful), maybe drop 3G, smaller screen, and text entry would have to be T9 for anyone other than a person with very small hands.

I wouldn't mind a larger screen model, I doubt that too.

[e1618978]

Originally Posted by FineWine

Wow. iPhone sales absolutely cratered. On the other hand, iPods soared. Funny, I bought a 120GB Classic back in December 08. To me, it's not all that surprising. In this economy, to be saddled with the outrageous AT&T contract, is asking too much of most consumers. I have friends who got iPhones for Xmas from their wives, but I suspect sales of iPhones will keep going down. And that Andy Zack guy got it horribly wrong, sadly the pessimistic analysts were more right than he was

You need to read the thread better - iPhone sales are flat once you take the channel stuffing effect into account.

[edit] Also channel draw down was 250,000 iPhone, so you really need to reduce last quarter's numbers by that much and increase this quarter's numbers by that much. Customers actually bought 4.65 million iphones this quarter and 4.9 million iphones last quarter. The channel currently holds 1.75 million iPhones.

[Jarman]

Originally Posted by macxpress

I was hoping a bit more for for iPhone sales.

I have bought two 16GB iPhones for Christmas. Sorry, I really couldn't afford more

[Mystigo]

I did a quick check on after hours trading. At 6 PM the stock was up 7.32 on top of todays 4.63. So AAPL is trading at roughly 90. Could go anywhere it pleases from there though.

[Wiggin]

Originally Posted by BuffyzDead

Tim Cook: "We're not going to build a low-end voice phone. Our objective is not to be unit share leader, it's to build the world's best phone."

I stated it here at AI under another post.
Smaller technology, in a smaller form factor, Implies higher price point.

IF Apple is in fact working on a nano iPhone, with all the bells and whistles of todays 3G BUT in a smaller form factor, it will sell for $399 and up.

Tim just said as much.

Or I could take Tim's comment to mean that Apple will never build a phone that's just a phone (ie, a "voice phone"). There's an awful lot of room between a run-of-the-mill, non-smart cell phone and the iPhone.

That said, even as Apple's Mac market share has risen, you've never really seen them explicitly go after market share with things like big sales, slim margins, low-end offerings, etc. That's just not Apple's style. They focus on making good products that people want to buy. If it happens that so many people want to buy it and it increases their market share, so be it. (Ok, I know it's not that simple. The point being that Apple doesn't chase market share.)

[mello]

Originally Posted by macxpress

Check Apple's stock in after hours trading...not what it closed at. Don't get me wrong..I hope it goes up. Its just typically goes down.

Where do you go online to see that?

[Mystigo]

Originally Posted by mello

Where do you go online to see that?

It's something I get with my etrade account. Not sure why I get it but it's free and it's nice.

[macxpress]

Gladly...it looks like Apple's stock for once is going up and staying there after hours! Great to see....

[SpamSandwich]

I think you can track after-hours trading with Yahoo Finance also, but after-hours trading has almost no effect on the regular trading hours results.

[Pascal007]

Originally Posted by amac4me

A growth slowdown is clearly evident in these numbers. The lower guidance for the current quarter relative to the street's estimates further demonstrates that Apple has to respond to the economic backdrop.

Look carefully : it doesn't seem that bad to me...

[JeffDM]

Originally Posted by mello

Where do you go online to see that?

http://finance.google.com/finance?q=Apple

The parts that aren't in blue are after hours.

Click "Zoom: 1d" for the best look.

It's roughly 90 right now.

[anantksundaram]

Originally Posted by JeffDM

http://finance.google.com/finance?q=Apple

The parts that aren't in blue are after hours.

Click "Zoom: 1d" for the best look.

It's roughly 90 right now.

I think it's probably more correct to say that "the parts that are in green are after-hours." (There are colors others than blue and green).

[joe in miami]

Originally Posted by mello

Where do you go online to see that?

http://finance.google.com/finance?q=NASDAQ:AAPL

[JeffDM]

Originally Posted by anantksundaram

I think it's probably more correct to say that "the parts that are in green are after-hours." (There are colors others than blue and green).

I'm not sure what you're talking about. Maybe you have a different theme. Trading hours show up as blue for me, non-trading are gray. There aren't any green sections on the chart.

[anantksundaram]

Originally Posted by JeffDM

I'm not sure what you're talking about. Maybe you have a different theme. Trading hours show up as blue for me, non-trading are gray. There aren't any green sections on the chart.

Just the default theme when I go to 'finance.google.com.'

Mine shows four colors of text: blue, green, back, and red.

[LuisDias]

Originally Posted by Pascal007

Look carefully : it doesn't seem that bad to me...

Arhm, if you connect 1st quarter to 1st quarter, 2nd to 2nd and so on, you'll see that this last quarter is quite off trend, and the slowdown shows up quite obvious. Usually, christmas quarter is the best yearly quarter. What your graph shows is that the previous quarter was in fact better than this one.

This is a bad sign, for it didn't happen this way for years, perhaps decades.

[JeffDM]

Originally Posted by anantksundaram

Just the default theme when I go to 'finance.google.com.'

Mine shows four colors of text: blue, green, back, and red.

Text? I'm talking about the data points on the chart, not text.

http://demaagd.com/gr/gofi_grab.jpg

[anantksundaram]

Originally Posted by JeffDM

Text? I'm talking about the data points on the chart, not text.

http://demaagd.com/gr/gofi_grab.jpg

Ah, and I was talking about the "Pre-market" data shown in green-colored text in your file: You can see a price change number ($6.25) and % change number (7.55%).


Both of us are correct, apparently.

[anantksundaram]

Given the performance of MSFT (5000 layoffs) and of NOK (massive drop in profit, market share, and share price), AAPL's execution in the past quarter is nothing short of astounding!

[addabox]

Sony actually lost 3 billion.

There seems to be a lot of "what Apple must do to fix iPhone sales" or "now Apple reaps the harvest of being too expensive or not having a netbook" type stuff floating around, but Apple's results really need to be put in context of what's happening to everyone else.

By that metric, they're doing astoundingly well.