IPhone helps Apple earn juicy profit
SAN FRANCISCO -- Apple aapl on Monday reported its second-best quarter on record sales of Macintosh computers, iPod music players and its new iPhone.
The results easily beat Wall Street's forecast, catapulting the company to No. 3 in domestic PC market share.
Apple reported revenue of $6.2 billion for the quarter ended Sept. 30, up 29% from the year-ago quarter. Profit was $904 million, or $1.01 a share, up 67% from $542 million, or 62 cents per share, a year earlier.
Analysts polled by Thomson Financial expected $6.07 billion in sales and per-share profit of 86 cents.
Apple shares surged 7% to $185.88 after hours, after closing at $174.36 in regular trading. Shares have more than doubled since the start of the year, when CEO Steve Jobs unveiled the iPhone.
The quarterly results underscored unprecedented demand for iPhones and iPods which, in turn, drove sales of Macintosh computers, analysts say.
"Invariably, people are walking into Apple stores to buy an iPod and often end up buying a Mac laptop," says Van Baker, an analyst at Gartner. Buoyed by its latest sales, Apple is now trailing only Dell dell and Hewlett-Packard hpq in USA. PC sales, and is leading Acer, Toshiba and Gateway, says researcher IDC.
The company said it shipped 1.12 million iPhones in the quarter, near the high end of a range of sales forecasts by some analysts. They expected 900,000 to 1.2 million iPhones sold. Apple, which started selling iPhones in the USA on June 29, will make them available in Europe beginning Nov. 9.
"Considering they have yet to start selling in Europe, it looks like they are very much on track to hit or exceed their target of 10 million (iPhones) sold by (late 2008)," says Charles Golvin, an analyst at Forrester Research.
During the fourth quarter, Apple also shipped 10.2 million iPods, up 17% from a year ago. Mac shipments rose 34%, to a record 2.2 million. As in the rest of the industry, notebooks drove Apple's sales: 62% of Macs shipped were portables.
"We have been very successful in expanding our customer base through iPod sales to Windows PC users," Peter Oppenheimer, Apple's CFO, said in a conference call
The growth spurt is expected to continue during Apple's current first quarter. The company expects earnings of about $1.42 per share on revenue of $9.2 billion.
Analysts on average expect earnings of $1.39 per share on sales of $8.58 billion. "We're looking to our strongest December quarter ever," Oppenheimer said.
In its best quarter — the year-ago December quarter — Apple reported earnings of $1 billion on sales of $7.1 billion.