Apple profits rise 26% on sales of 2.6M Macs, 6.8M iPhones
Apple said Tuesday that fourth-quarter profits rose more than 26 percent to $1.14 billion, or $1.26 per diluted share, on sales of $7.9 billion for the three-month period ended September 27, 2008.
Those results compare to revenue of $6.22 billion and net quarterly profit of $904 million, or $1.01 per diluted share, in the year-ago quarter. Gross margin was 34.7 percent, up from 33.6 percent in the year-ago quarter. International sales accounted for 41 percent of the quarter's revenue.
Apple shipped 2,611,000 Macintosh computers during the quarter, representing 21 percent unit growth and 17 percent revenue growth over the year-ago quarter. The company sold 11,052,000 iPods during the quarter, representing eight percent unit growth and three percent revenue growth over the year-ago quarter. Quarterly iPhone units sold were 6,892,000 compared to 1,119,000 in the year-ago-quarter.
"Apple just reported one of the best quarters in its history, with a spectacular performance by the iPhone -- we sold more phones than RIM," said Apple chief executive Steve Jobs. "We don't yet know how this economic downturn will affect Apple. But we're armed with the strongest product line in our history, the most talented employees and the best customers in our industry. And $25 billion of cash safely in the bank with zero debt."
In accordance with the subscription accounting treatment required by GAAP, Apple 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 $11.68 billion of "Adjusted Sales" and $2.44 billion of "Adjusted Net Income."
"We're very pleased to have grown revenue 35 percent and to have generated $9.1 billion in cash in fiscal 2008," said Peter Oppenheimer, Apple's CFO. "Looking ahead, visibility is low and forecasting is challenging, and as a result we are going to be prudent in predicting the December quarter. We are providing a wide range for our guidance, targeting revenue of $9.0 to $10.0 billion and earnings per diluted share between $1.06 and $1.35."
Apple will conduct its Q4 2008 financial results conference call in about 30 minutes -- AppleInsider will provide full coverage.
Additional Coverage
Steve Jobs on Apple's cash, NetBooks, Apple TV, and Cheap PCs
Notes of interest for Apple's Q4 2008 results call
Apple iPhone 3G sales surpass RIM's Blackberry
iPhone App Store continues to exceed iTunes song sales growth
Those results compare to revenue of $6.22 billion and net quarterly profit of $904 million, or $1.01 per diluted share, in the year-ago quarter. Gross margin was 34.7 percent, up from 33.6 percent in the year-ago quarter. International sales accounted for 41 percent of the quarter's revenue.
Apple shipped 2,611,000 Macintosh computers during the quarter, representing 21 percent unit growth and 17 percent revenue growth over the year-ago quarter. The company sold 11,052,000 iPods during the quarter, representing eight percent unit growth and three percent revenue growth over the year-ago quarter. Quarterly iPhone units sold were 6,892,000 compared to 1,119,000 in the year-ago-quarter.
"Apple just reported one of the best quarters in its history, with a spectacular performance by the iPhone -- we sold more phones than RIM," said Apple chief executive Steve Jobs. "We don't yet know how this economic downturn will affect Apple. But we're armed with the strongest product line in our history, the most talented employees and the best customers in our industry. And $25 billion of cash safely in the bank with zero debt."
In accordance with the subscription accounting treatment required by GAAP, Apple 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 $11.68 billion of "Adjusted Sales" and $2.44 billion of "Adjusted Net Income."
"We're very pleased to have grown revenue 35 percent and to have generated $9.1 billion in cash in fiscal 2008," said Peter Oppenheimer, Apple's CFO. "Looking ahead, visibility is low and forecasting is challenging, and as a result we are going to be prudent in predicting the December quarter. We are providing a wide range for our guidance, targeting revenue of $9.0 to $10.0 billion and earnings per diluted share between $1.06 and $1.35."
Apple will conduct its Q4 2008 financial results conference call in about 30 minutes -- AppleInsider will provide full coverage.
Additional Coverage
Steve Jobs on Apple's cash, NetBooks, Apple TV, and Cheap PCs
Notes of interest for Apple's Q4 2008 results call
Apple iPhone 3G sales surpass RIM's Blackberry
iPhone App Store continues to exceed iTunes song sales growth
Comments
On the surface Apple beat the numbers. But I suspect that had a lot to do with how they are booking iPhone revenue.
Mac sales were below most analyst's estimates and revenue was below most analyst's estimates. While the numbers are good, investors may have expected even better.
I wonder how APPL is doing in after hour trading?
I have to also say that I keep buying on dips. Since, I'm holding for the long term, I'm not too worried. Apple's stock has been absolutely crushed over the past month, and I'm sure when the broader economy recovers, Apple's stock will go way up. I guess it's just a matter of positive thinking and holding for the long term.
Today, you have to ask "Which bank?"
It'll be interesting to see the reaction on wall street tomorrow.
On the surface Apple beat the numbers. But I suspect that had a lot to do with how they are booking iPhone revenue.
Mac sales were below most analyst's estimates and revenue was below most analyst's estimates. While the numbers are good, investors may have expected even better.
I wonder how APPL is doing in after hour trading?
Apple beat the numbers DESPITE the way they account for the iPhone and Apple TV.
They take the revenue for both over 24 months which means they have only reported 3 months of revenue for the 6 million phone sold in the quarter. The rest will be taken over the next 21 months and will provide a constant revenue stream regardless of how many phones they sell over that period.
It'll be interesting to see the reaction on wall street tomorrow.
On the surface Apple beat the numbers. But I suspect that had a lot to do with how they are booking iPhone revenue.
Mac sales were below most analyst's estimates and revenue was below most analyst's estimates. While the numbers are good, investors may have expected even better.
I wonder how APPL is doing in after hour trading?
up 2% at the beginning of the call.
points of interest:
selling more ipods than any other non-holiday quarter. That's big, everyone has been making noise about iPhone eating into ipod sales.
Biggest non-holiday quarter ever? Nice.
Stupid as the analyst-system can be, you get dinged when you don't meet their expectations. You have to believe that those expectations are responsible for part of the share price at any point in time.
backtomac: I think you need to provide more info on what you mean about the iphone numbers - otherwise you don't really have much of a point there.
"And $25 billion of cash safely in the bank with zero debt.?
Today, you have to ask "Which bank?"
In Steve's private bunker.
Apple beat the numbers DESPITE the way they account for the iPhone and Apple TV.
They take the revenue for both over 24 months which means they have only reported 3 months of revenue for the 6 million phone sold in the quarter. The rest will be taken over the next 21 months and will provide a constant revenue stream regardless of how many phones they sell over that period.
Yes but they deferred revenue from the 1st gen iPhone and isn't this the quarter when they start to book it?
Yes but they deferred revenue from the 1st gen iPhone and isn't this the quarter when they start to book it?
They're selling a lot more iPhones now than they were then. I think that erases the point you're trying to make.
backtomac: I think you need to provide more info on what you mean about the iphone numbers - otherwise you don't really have much of a point there.
The revenue was below estimates but EPS beat estimates.
Apple have deferred earnings from the sales of the 1st iPhones that I suspect they are now booking.
I don't know this for a fact but am suggesting this to be the case.
They're selling a lot more iPhones now than they were then. I think that erases the point you're trying to make.
No it doesn't.
Yes but they deferred revenue from the 1st gen iPhone and isn't this the quarter when they start to book it?
no, they book 1/24th every months since they were sold.
The revenue was below estimates but EPS beat estimates.
Apple have deferred earnings from the sales of the 1st iPhones that I suspect they are now booking.
I don't know this for a fact but am suggesting this to be the case.
Yes they are taking revenue from every iPhone they have sold so far, so each month they will take more and more as they sell more and more phone. If they have sold 10 million iPhones then they are taking revenue from ALL 10 million right now, but only one 24th. In 3 months time they will be taking revenue from approx 14 million iPhones and it will be an ever increasing number, even when the first phones pass the 24 months.
selling more ipods than any other non-holiday quarter. That's big, everyone has been making noise about iPhone eating into ipod sales.
Also consider that with almost 7mil iphones sold, one can look at it as Apple selling 18mil ipods for the quarter, further entrenching the ipod and iTMS in the market.
No it doesn't.
Actually it does. I'm an accountant.
Let's say Apple sold 4M iPhones before this quater, and 6M this quater(2M/mo). - I use 6M for ease of calculation, the result is not that far different.
they would book equivalent of
(4M / 24 * 3) + (2M / 24 * 3) + (2M/24 * 2) + (2M/24 * 1) = 1M, despite having sold 6M units.