Apple net profit soars on record iPhone, Mac sales

Apple net profit soars on record iPhone, Mac sales
AFP
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First Published: Tue, Oct 20 2009. 11 00 AM IST
Updated: Tue, Oct 20 2009. 11 00 AM IST
San Francisco: Apple posted stellar quarterly profit but could have its fortunes tested when Microsoft’s new Windows 7 operating system and a heralded Droid smart phone debut this month.
Apple on Monday reported quarterly net profit of $1.67 billion on record sales of iPhones and Macintosh computers.
Apple recorded $9.87 billion in revenue during the fourth quarter of its fiscal year, which ended 26 September, compared with $7.9 billion in revenue in the same period last year.
Apple’s quarterly profit amounted to $1.82 per share, a jump from the same quarter last year when it reported profit of $1.14 billion, or $1.26 per share.
“We are thrilled to have sold more Macs and iPhones than in any previous quarter,” said Apple chief executive Steve Jobs. “We’ve got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010.”
Rumors of Apple gadgets being readied for market include an “iTablet” computing device akin to a magazine-sized iPhone that could be used for reading digitized books as well as watching videos or surfing the Internet.
Apple reported that it sold 3.05 million Macintosh computers during the quarter, a 17% increase from the same period last year.
The Cupertino, California-base company saw sales of its popular iPhone smartphones climb seven percent to 7.4 million while sales of iPods sagged eight percent to 10.2 million units.
“It just turned out to be a stunning quarter,” said analyst Rob Enderle of Enderle Group in Silicon Valley. “With Windows 7 stalled the PC (personal computer) side of the market and Apple got a free ride back to school.”
Microsoft launches its new Windows 7 operating system on Thursday, about two months after Apple’s Snow Leopard operating system hit the market.
Many people considering buying new computers have likely put off getting PCs to wait for the latest software, leaving Apple ample time to entice those customers with Macintosh machines.
Apple retail stores brought in record-high revenue during the recently-ended quarter, and about half of the people buying Macintosh computers were reportedly getting the Apple made machines for the first time.
“When Windows 7 hits on Thursday, Apple is going to get hit with a tsunami and it will be tough in the face of a feeding frenzy on the PC side,” Enderle said.
With Windows 7 launching after the back-to-school computer shopping season and at the cusp of the year-end holiday season, hardware makers will “hit the ground running” with well-equipped PCs at tempting prices, Enderle said.
Apple’s revenue for the full fiscal year grew 12% and net profit rose by 18% despite “extraordinarily challenging times,” according to Apple chief financial officer Peter Oppenheimer.
Apple has teamed with China Unicom to start selling iPhone 3GS smartphones in the China on 30 October.
“We are eager to get started,” Apple chief operating officer Tim Cook said of selling iPhones in China. “It is a huge market.”
Apple could “take it in the shorts” if a Droid mobile telephone due to hit the US market at the end of this month lives up to the hype ricocheting about the Internet, according to Enderle.
Motorola is making the Droid smartphones, which are based on Google-backed open-source Android operating software and linked to telecom service from Verizon.
Cook said Apple isn’t worried about the growing ranks of smartphones trying to dethrone the iPhone in the market.
“We have significant momentum, and look at the ecosystem with iTunes and the App Store,” Cook said.
Apple projected its earnings in the current quarter to range from $1.70 to $1.78 per share based on expected earnings of from $11.3 billion to $11.6 billion.
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First Published: Tue, Oct 20 2009. 11 00 AM IST
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