Apple sells more iPhones, iPads than ever in record quarter
Powered by its strongest-ever sales of its iPhone and iPad devices, Apple reported record earnings Tuesday, soon after its stock hit an all-time high for the second day in a row during regular trading.
Apple’s profit and revenue numbers far exceeded Wall Street's expectations, and the stock quickly shot up more than 5% in after-hours trading, to hover around $396.
The most valuable technology company by stock market value at close to $348 billion, Apple is now closing in on ExxonMobil, the last remaining firm with a higher market value, at $414 billion.
Apple more than doubled its profit over the same quarter a year earlier, to $7.31 billion from $3.25 billion, and saw an 82% increase in revenue, to $28.57 billion from $15.70 billion a year earlier.
The company sold a record 20.3 million iPhones, a nearly 150% increase over the same quarter a year earlier, and almost 2 million more than the previous quarter. That increase is notable given that Apple's iPhone sales generally declined in the quarter ended in June as users waited for a newer version of the phone. Apple sold 9.25 million iPads during the quarter, beating its record of 7.3 million, and also sold nearly 4 million Macintosh computers, a 14% increase from a year earlier. Sales of its iPod music player, however, dropped by 20% from a year earlier, to 7.54 million.
“We’re thrilled to deliver our best quarter ever, with revenue up 82% and profits up 125%,” said Apple Chief Executive Steve Jobs, in a statement. Jobs, who has been on medical leave since January, added, “Right now, we’re very focused and excited about bringing iOS 5 and iCloud to our users this fall.”
Apple has not released a banner product since April, when it launched the iPad 2, the second iteration of its bestselling tablet computer. This is the first summer since the iPhone's debut in 2007 that the company has not marketed a new version of the device.
In recent months, news reports have suggested that Apple will not be ready to launch a new iPhone, the fifth, until September. Apple blogs and rumor sites have made guesses about the design of the new phone -- including whether it will be substantially thinner and have a larger screen and a better camera. Apple, reports speculate, may be releasing a smaller, less expensive iPhone alongside the standard version. Some have wondered whether Apple would add Sprint Corp. to its list of U.S. wireless providers of the iPhone.
The famously secretive company has given no hint about the look of the new phone or the timing of its release.
Growth in Apple's international sales of the iPhone may also be helping to fuel its financial success. Besides the U.S. and Canada, Apple now offers the handset in more than 100 countries in Europe, Africa, Asia, Latin America and the Middle East. The company has seen strong sales of its iPhone in China, a nation of hundreds of millions of cellphone users, and may be close to signing a deal with China's largest cellphone provider, China Mobile Ltd., according a report in the Wall Street Journal.
Apple also won a preliminary victory last week in a high-stakes patent war with its smartphone rivals. A judge at the U.S. International Trade Commission ruled that HTC Corp., which makes phones using Google's Android software, infringed two of Apple's long-standing technology patents. The two patents cover fundamental elements of smartphone technology and, if Apple is able to defend them, that may allow the company to pressure rivals to switch technologies or pay it royalties. The ITC still has to make a final ruling on the HTC case, and the company says it will appeal if necessary.
-- David Sarno
Image: Visitors have their photo taken in front of an Apple Inc. sign at the company's headquarters in Cupertino, Calif. Credit: David Paul Morris/Bloomberg