The financial meltdown in the USA seems to be having no significant effect on Apple. Despite the worldwide credit crunch, it managed to sell more products than ever before and laughed all the way to bank with record revenue earnings. Apple posted revenues of $7.9 billion and net quarterly profit of $1.14 billion. It sold 6.9 million iPhones, over 2.6 million Macintosh computers, and over 11 million iPods in the last quarter. “Some remarkable things are happening at Apple,” said Steve jobs, Apple’s CEO, in a rare conference call appearance. He said:
“Apple just reported one of the best quarters in its history, with a spectacular performance by the iPhone—we sold more phones than RIM. 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. We may get buffeted around by the waves a little bit, but we’ll be fine and stronger than ever when the waters calm.”
For the company’s fourth fiscal quarter, which ended on September 27 this year, Apple reported revenues of $7.9 billion, which was $1.7 billion higher than the $6.2 billion figure in the same quarter last year. Net income was $1.14 billion with earnings per diluted share of $1.26. Analysts had been expecting revenues of $8 billion and earnings per diluted share of $1.11.
Buoyed by the strong earnings, investors shored up to buy AAPL on the Nasdaq Stock Market. Apple’s stock prices were up by $9.91 or 11%. Even AT&T benefited from the strong iPhone sales and its stock price rose by 85 cents or 3.3%.
Apple Outsells RIM; 6.9m iPhones off the shelves
Apple has sold 6.9 million iPhone 3Gs in the last quarter. Compare that number with the total first generation iPhones sold—6.1 million! Apple has already achieved its stated goal of selling ten million iPhones three months ahead of schedule.
What does the 6.9 million number signify? Two things: (1) Apple is now the world’s third largest mobile phone supplier in terms of revenue, trailing behind Nokia and Samsung; and (2) They outsold RIM’s entire range of BlackBerry phones. RIM sold 6.1 million phones compared to the 6.9 million iPhones. “RIM is a good company that makes good products and so it is surprising that after only 15 months in the market, we could outsell them in any quarter,” remarked Steve Jobs.
The Mac, iTunes Store, and iPod sales have also been strong. The company sold over 2.6 million Macs with a 21% year-over-year growth for Mac sales, beating the average industry growth by a comfortable margin. They sold over 11 million iPods, setting a new record for a non-holiday quarter. The iTunes Store now has over 65 million registered customers and an impressive catalog of over 8.5 million music titles. A stunning grand total of 200 million applications have been downloaded from the App Store already, within just 102 days of its launch!
“We don’t know how to make a $500 computer that’s not a piece of junk”
At the end of conference call, in the QnA session, Steve Jobs remarked that Apple wouldn’t be making a cheap notebook primarily for surfing the Internet anytime soon. “Our DNA will not allow us to ship that,” he remarked. He said that Apple would rather cater to the large number of customers who would like to and can afford to buy their products instead of going after the extremely price conscious buyer. While he was tight lipped about any upcoming products, Steve Jobs remarked that the Apple TV and the digital living room market would remain as much of a “hobby” in 2009 as it is now, specially given the current economic condition. He also noted that the strong sales was because of the fact that Apple has strong products, talented employees, and the smartest and most product aware customers. Doesn’t that just make your heart swell with pride!