Apple posts Q2 revenue of $13.5 billion, profit of $3.07 billion

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Date: Tuesday, April 20th, 2010, 15:06
Category: Finance, News

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Delivering its second quarter financial results on Tuesday, Apple announced that the company sold 10.89 million iPods during the quarter (compared to sales of 11.01 million iPods in the year-ago quarter, and down 48% from the previous quarter) and 8.75 million iPhones in the quarter (a 131% increase year-over-year, and up from 8.7 million units in the prior quarter).

Per iLounge, Apple posted revenue of US$13.5 billion and net quarterly profit of US$3.07 billion, or US$3.33 per diluted share, compared with revenue of US$9.08 billion and net quarterly profit of US$1.62 billion, or US$1.79 per diluted share in Q2 2009.

International sales accounted for 58% of the quarter’s revenue and sales of Other Music Related Products + Services were up 27% from the year-ago quarter, and 14% from Q1 2010, to US$1.3 billion total.

Notably, the numbers from Q2 2009 are different from those originally reported due to Apple’s change in accounting rules that sees the company now recognize “substantially all of the revenue and product costs from the sales of iPhone and Apple TV at the time of sale,” instead of accounting for the sales over a 24-month period.

“We’re thrilled to report our best non-holiday quarter ever, with revenues up 49% and profits up 90%,” said Steve Jobs, Apple’s CEO. “We’ve launched our revolutionary new iPad and users are loving it, and we have several more extraordinary products in the pipeline for this year.”

“Looking ahead to the third fiscal quarter of 2010, we expect revenue in the range of about US$13.0 billion to $13.4 billion and we expect diluted earnings per share in the range of about US$2.28 to US$2.39,” said Peter Oppenheimer, Apple’s CFO.

Apple Posts $3.38 Billion Profit, $15.68 Billion in Sales for Q1 Results

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Date: Tuesday, January 26th, 2010, 07:56
Category: Finance, News

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Even if the global economy’s in iffy shape, you can’t tell it by Apple.

Per Macworld, the company posted its best-ever performance for the first fiscal quarter, citing tallied sales of US$15.68 billion and a net quarterly profit of US$3.38 billion. That compares to year-ago figures of $11.88 billion in sales and US$2.26 billion in net quarterly profit.

“We’re extremely pleased with our record-breaking performance, including our 32% in growth in revenue and 50% growth in net income,” Apple chief financial officer Peter Oppenheimer told analysts during a Monday afternoon conference call to discuss Apple’s quarter numbers.

The company’s quarterly performance translated to earnings of US$3.67 per share, up 47% from the US$2.50 per share that it earned in the year-ago quarter.

Apple’s reports, which may seem a bit off in comparison to last January’s returns, reflect the retrospectively adopted Financial Accounting Standards Board’s amended accounting standards during the 2010 first quarter. Adopting those standards significantly alters how Apple accounts for certain items such as the iPhone and Apple TV sales. The revised standards allow Apple to recognize revenue and product at the time of sale and the company has restated its results for the 2007, 2008, and 2009 fiscal years to reflect this change.

“We believe [the new accounting rules] will better enable us to recognize the underlying economics and performance of our business,” Oppenheimer said.

For the 2010 fiscal first quarter, Apple sold 3.36 million Macs, up 33% from the 2.5 million units the company sold in Q1 of 2009.

The Mac sales figure sets a new record, topping the 3.05 million Macs Apple sold during the fiscal fourth quarter of 2009.

The fall revamp of the iMac line helped boost desktop sales for the quarter. In October, Apple replaced its 20″ and 24″ iMacs with new 21.5″ and 27″ configurations of the all-in-one desktop. Apple sold 1.23 million desktops in its first quarter of 2010, an increase of nearly 70% from the 728,000 desktops it sold a year ago.

Notebook sales came in at just under 2.13 million units sold during the first quarter, a number which accounts for 63% of all the Macs sold during the quarter. Portable sales rose 18% from the 1.796 million laptops Apple sold in the year-ago quarter.

Overall education sales for Mac products grew 16% from last year, reflecting Apple’s best growth rate in that segment since before the start of the current recession, according to chief operating officer Tim Cook. The K-12 and higher-education channels both reported record sales for the December quarter.

“Our whole education business is based on really understanding teaching, learning, and student achievement, and we think we’re the only tech company that really gets that,” Cook said.

iPhone sales reached record heights in the quarter with the company selling 8.7 million iPhones in three months, breaking the record of 7.4 million set in the previous quarter. iPhone sales were twice what they were during the previous year’s first quarter with the sales value of those 8.7 million iPhones exceeding US$5.4 billion. The average selling price of iPhone models was down 5% versus the prior year, likely owing to the existence of the cut-rate US$99 iPhone 3G model.

In response to a question from an analyst, Cook offered praise for often-criticized U.S. wireless partner AT&T. “AT&T is a great partner,” he said. “In the vast majority of locations, we think iPhone customers are having a great experience… AT&T has acknowledged that they’re having a few issues in some cities, and they have plans to address these. We have personally reviewed these plans, and we have high confidence [in them].”

Regarding Apple’s acquisition of Quattro Wireless, a mobile advertising company, Cook said that Apple “look[s] forward to providing developers with a great opportunity for advertising,” but that mobile advertising is currently “in its infancy.”

Not every product segment saw growth during the quarter and iPod sales fell 8% from Q1 of 2009, as Apple sold 21 million music players during the quarter. However, Oppenheimer characterized that decline as expected. Indeed, overall iPod sales growth has been flat for some time—sales have declined for three consecutive quarters now.

Still, Apple executives didn’t sound particularly bothered on Monday by the iPod’s quarterly performance. The music player continues to gain market share internationally, and its share of the U.S. market remains at more than 70%, according to Oppenheimer.

Despite the lower iPod numbers, Oppenheimer said Apple sold 55% more iPod touches this year than it did in the first quarter of 2009. The average selling price of the iPod increased by 9% during the quarter, driven by sales of the touch.

Oppenheimer told analysts on Monday that the iTunes Store had enjoyed a “record-breaking quarter,” though the company provided no revenue figures for its online retail arm for music, movies, TV programs, and mobile apps.
Retail and other figures

Apple finished the first quarter with 283 retail stores, after opening 10 new outlets during the quarter. Those openings included high-profile stores near the Louvre in Paris and New York’s Upper West Side. Apple also remodeled 32 stores during the quarter, for a total of 100 remodels during the 2009 calendar year.

Retail revenue rose 17% to US$1.97 billion for the quarter. Average revenue per store was US$7.1 million, up from US$7 million in the year-ago quarter. The brick-and-mortar stores sold a record 680,000 Macs, with half of those sold to customers who were new to the Mac.

Apple is expected to open between 40 and 50 stores during the 2010 fiscal year, Oppenheimer said, with half of those outlets located outside the U.S.

Even after a quarter of cash outlays that included the purchase of online music streaming company Lala, the company reported that it now holds cash and short-term investments totaling US$39.8 billion, up $5.8 billion from the previous quarter.

Looking ahead to the March quarter, Oppenheimer told analysts to expect sales between US$11 billion and US$11.4 billion. That compares to restated sales of US$9.1 billion for the fiscal second quarter of 2009. Apple expects earnings between US$2.06 and US$2.18 per share for the upcoming quarter; that compares to US$1.79 per quarter a year ago, after adjusting for the new accounting rules.

“The new products we are planning to release this year are very strong, starting this week with a major new product that we’re really excited about,” CEO Steve Jobs said in a statement accompanying Monday’s earnings release.

Apple Posts US$1.67 Profit for Q4 2009

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Date: Tuesday, October 20th, 2009, 04:57
Category: Finance, News

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In spite of a sagging global economy, Apple posted the results to its most profitable quarter ever, the company setting records for both Mac and iPhone sales. According to Macworld, the company reported a net profit of US$1.67 billion, or US$1.82 per share, on revenue of US$9.87 billion for its fourth quarter earnings.

Comparing those numbers to Apple’s year-ago figures, quarterly profits rose 46%, while earnings per share jumped 44%. Revenue increased 25% from the September 2008 quarter. At the end of the corner, the company had US$34 billion of cash on hand.

For the full 2009 fiscal year, Apple’s revenue rose 12% while its income increased 18% from 2008, according to chief financial officer Peter Oppenheimer. Those increases come during what the Apple executive called “extraordinary challenging times” which have done little to slow the company’s growth.

“We are thrilled to have sold more Macs and iPhones than in any previous quarter,” said Apple CEO Steve Jobs in a statement accompanying the earnings announcement. “We’ve got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010.”

For the December quarter, Apple told analysts to expect between US$11.3 and US$11.6 billion in sales and earnings ranging from US$1.70 to US$1.78 per share. This guidance was given without accounting for a rule change in the way Apple recognizes revenue from the iPhone and Apple TV. Apple was uncertain when it would adopt the new accounting method, which was OK’d by the Financial Accounting Standards Board last month.

Over the course of the quarter, Apple sold 3.05 million Macs during the quarter (a 17 percent increase over what it sold for the same three-month period in 2008). That 3.05 million figure sets a record for Mac sales, topping the previous high-water mark of 2.61 million Macs sold during the fiscal fourth-quarter of 2008.

During the quarter, Apple sold nearly 2.3 million notebooks, with portables accounting for an astounding 74% of the Macs sold during the last three months.

“Last quarter was the quarter of the portable,” chief operating officer Tim Cook said during a Monday conference call to discuss Apple’s earnings. In response to one analyst’s comment that “the [laptop] price cut worked,” Cook responded loudly, “Yes, it did!”

Cook also said that Snow Leopard sales were stronger than Apple expected, with twice as many sales of Snow Leopard upgrades during the operating system’s first five weeks on sale than Leopard made during its first five weeks.

iPhone sales rose 7% from the year-ago quarter to nearly 7.4 million units. That compares to a little less than 6.9 million iPhones in the September 2008 quarter—a three-month period that saw Apple roll out the iPhone 3G in a number of markets around the globe.

For the quarter, Apple reported recognized revenue from iPhone handset sales of $2.3 billion, a 185% jump from US$806 million in last year’s fourth quarter.

If Apple had any disappointments in the quarter, it would be in its iPod business, where sales of the handheld music players fell 8% from the year-ago quarter to 10.2 million units. It was the second consecutive quarter where Apple saw iPod sales drop from the year-ago period.

However, Apple saw signs for optimism in its iPod numbers. According to the company, 50% of recent iPod buyers were purchasing their first iPod. What’s more, sales of the iPod touch doubled when compared to the same quarter a year ago, and Apple believes it can attract even more customers to the widescreen music player after cutting the price of the 8GB iPod touch to $199 last month.

“We believe the iPod lineup is attractive positioned for the holiday buying season,” Oppenheimer told analysts during Monday’s conference call. And that’s critical for Apple, which traditionally sees its highest iPod sales during the December quarter. In the December 2008 quarter, for example, Apple sold 22.7 million music players.

Apple Could Receive FASB Approval for Accounting Changes, Remove iPod Touch Upgrade Fees

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Date: Friday, September 18th, 2009, 04:34
Category: Finance, News

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If you’ve ever been irked at the small charges you’ve had to pay for an iPod touch software upgrade, this may be about to go by the wayside. According to Ars Technica, a rule governed by the Financial Accounting Standards Board, that’s been heavily lobbied for by Apple and other electronics companies, may be enough to lift the charge that iPod touch owners have had to pay for updates of significant features to their devices. The rule focuses on “subscription accounting”, or devices that gain “significant new functionality” after their sale, like the iPhone, have to be reported over a series of years rather than all at the same time (presumably because the revenues associated with the product were the result of a series of updates, not just one lump sum).

In the case of the iPhone, subscription charges associated with them over two years round out the criteria. The iPod touch is different and because Apple doesn’t want to report the sales of those devices over a period of time, they’ve had to charge minimum fees for updates in the form of the US$10 and other fees that iPod touch owners have paid for the firmware updates. But if the new rule receives FASB approval, then Apple would be able to report sales of the iPod touch all together without having to worry about charging for updates, as well as the dual GAAP and non-GAAP reporting we’ve heard on their conference calls.

Such a chance could also help Apple’s stock price (seeing all of the iPhone’s sales at once would boost investor confidence), and it would help developers who are asking all users of both the iPhone and iPod touch to update right away, as they wouldn’t have to wait until users found the few bucks in question before downloading a large new update.

Apple to Release Q3 Financial Results Today

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Date: Tuesday, July 21st, 2009, 05:34
Category: Finance, News

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It’s that time again and Apple has released a media advisory stating that the company will be releasing the financial results for the third fiscal quarter and second calendar quarter of 2009. The results will cover sales from March 28th, 2009 through June 26th, 2009, and will be released at the close of trading (4:00 PM Eastern / 1:00 PM Pacific) on Tuesday.

The conference call discussing the results will follow at 2:00 PM Pacific and will be available via an audio webcast.

Stay tuned to PowerPage throughout the day for updates galore.

Nvidia Admits to “Ongoing” Failure Problem in Some Notebooks During SEC Filing

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Date: Thursday, May 21st, 2009, 08:22
Category: Finance

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Graphics processor firm Nvidia formally stated that some notebooks utilizing its chips continue to have “failure” issues, in a filing with the Securities and Exchange Commission on Wednesday.
Per cnet, Nvidia stated that though it does not continue to see “abnormal failure rates” in systems using Nvidia products,” some notebooks are still affected.
“We continue to not see any abnormal failure rates in any systems using Nvidia products other than certain notebook configurations. However, we are continuing to test and otherwise investigate other products,” Nvidia said, adding, “there can be no assurance that we will not discover defects in other MCP or GPU products.” (MCP stands for Media and Communications Processor; GPU stands for Graphics Processing Unit.)
On July 2 of last year, Nvidia announced that the company was planning to take a one-time charge to cover costs associated with problems with materials used in certain versions of its laptop graphics chips. Subsequently, a US$196 million charge was recorded in the second quarter of its 2009 fiscal year to “cover anticipated customer warranty, repair, return, replacement and associated costs” with the problem.
In the company’s 10-Q filing, Nvidia cited a “balance of US$145.7 million associated with incremental repair and replacement costs from a weak die/packaging material set.” and “US$31.2 million for the three months ended April 26, 2009 in payments related to the warranty accrual associated with incremental repair and replacement costs from a weak die/packaging material set.”
Nvidia paid or incurred US$50.3 million against the original “warranty accrual” in its fiscal third quarter and fourth quarter 2009, such that the remaining balance of the “bump-crack accrual” (defect) was US$145.7 million at the end of its fiscal fourth quarter, according to Nvidia.
Nvidia is also negotiating with insurance companies over payments to PC makers regarding GPU failures, according to a report filed by TGDaily.
As early as 2007, Hewlett-Packard listed notebook models affected by the graphics chip glitch. In August 2008, Dell also listed affected models with Apple stating in October that it would repair faulty graphics chips.
In the 10-Q filing, Nvidia also stated that “in September, October and November 2008, several putative consumer class action lawsuits were filed against us, asserting various claims arising from a weak die/packaging material set in certain versions of our previous generation MCP and GPU products used in notebook systems.”

Apple Announces Q2 Financial Results, Reports US$1.21 Billion Profit

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Date: Thursday, April 23rd, 2009, 07:19
Category: Finance

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Amidst strong iPhone and iPod sales, Apple Inc. reported a US$1.21 billion profit for its second quarter despite Mac sales being down 3% for the quarter compared to last year.
“We are extremely pleased to report the best non-holiday quarter revenue and earnings in our history,” Peter Oppenheimer, Apple’s CFO said during the conference call announcing the results.
According to Macworld, Apple posted a total revenue of US$8.16 billion, its best non-holiday quarter to date. The quarter’s revenue and profit was higher than the $7.51 billion revenue and $1.05 billion profit posted during the same quarter last year.
During the quarter, Apple sold 2,216,000 Macs with notebook sales comprising 63% of this at 1,398,000 units and desktop Macs accounting for the remaining 818,000 units.
When asked about Apple’s plans for releasing a netbook, Apple executive Tim Cook said, “If we find a way that we can deliver an innovative product that really makes a contribution, then we will do that–we have some interesting ideas in this space.” Cook said that netbooks currently have cramped keyboards, terrible software, junky hardware, and very small screens, “not something that we would put the Mac brand on, quite frankly.” He added that people who want a small computer that does browsing and e-mail might want to buy an iPod touch or an iPhone.
iPod sales reached 11,013,000, a 3% gain over the same quarter last year. Apple said its U.S. market share for digital music players is more than 70%, based on data from market-reseach firm NPD. The iPod also grew in worldwide markets, with healthy unit sales growth in the U.K., France, Germany, Japan, Australia, and China.
Click the jump for the full story…

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iPhone/iPod Sales Create Flash Memory Shortage

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Date: Wednesday, August 15th, 2007, 15:19
Category: Finance

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We’re kind of all to blame for this one – or at least everyone who went out and snagged an iPod or iPhone.
The guys over at Macworld U.K. are reporting that flash memory prices have climbed 20% in the last two weeks. The article cites electronics wholesaler Chinavision.com, which has stated that the increased prices make Christmas gadgets more expensive this holiday season.
Short-term price boosts may be attributable to a recent power failure in a Samsung flash memory plant. The outage could have set production back by a week or more and created a worldwide shortage of flash memory, according to Chinavision.
An extremely strong demand for Apple products, namely the iPod and iPhone, may have compounded this. Apple is estimated to consume about 25% of the world’s flash memory supply for its products.
The news may be even worse for other companies, as smaller manufacturers of MP3 players have been forced to close shop in reaction to the price shift. “Their orders just dried up,” said Rose Li, PR manager for Chinavision.com. Li also commented that while flash memory price changes are historically known to be volatile, the latest jump has been both unusually severe and sudden.
An exact guess as to how dramatically the price fluctuation would affect holiday shopping was not immediately available.
If you have your two cents to throw in on this, let us know in the comments or forums.

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Apple Reports US$818 Million Profit for Third Quarter

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Date: Wednesday, July 25th, 2007, 16:03
Category: Finance

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On Wednesday, Apple reported its third quarter financial results. The company stated a profit of US$818 million (or US$0.92 per diluted shared) on US$5.41 billion in revenue for the third quarter.
The results show a marked increase as opposed to a profit of US$472 million (or US$0.54 per diluted share) on US$4.37 billion for the third quarter of 2006.
Apple shipped more than 1.76 million Macs in the third quarter, demonstrating 33% growth compared with Q3 of 2006 as well as 9.8 million iPods, representing 21% growth from a year ago.
Specific iPhone sales numbers were kept under wraps, although Apple CEO Steve Jobs stated he hopes to sell the one-million iPod by the end of its first full quarter, ending September 29th.
Other highlights included the following:
-This quarter yielded the highest revenue in Apple history.
-Representatives cited continued strong demand for the iPod.
-Strong revenue and a favorable commodity market.
-Strong demand for the MacBook and MacBook Pro laptops.
Click the jump for the full story…

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Intel Capital to Invest US$218.5 Million in VMWare

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Date: Monday, July 9th, 2007, 09:34
Category: Finance

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In other news, Intel Capital, Intel’s investment wing, has announced that it will invest US$218.5 million in emulation software make VMWare.
The investment will occur within VMWare’s Class A common stock, which is subject to customary regulatory approval.
According to Macworld News, this will allow Intel Capital to own about 2.5% of VMWare’s outstanding common stock and an Intel executive is expected to be appointed to VMWare’s board of directors in return.
VMWare is currently nearing an official release of its Fusion emulation software for the Mac OS X platform. The software will retail for US$79.99 and is currently being offered at a pre-order price of US$39.99. Additional details regarding the current beta, which entered final candidate status last week, can be found here.

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