Apple reports record quarterly earnings

13:19, April 21, 2011      

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Apple Inc. on Wednesday reported record second fiscal quarter results that blow out analysts'expectations, citing strong demands for its products.

For its fiscal 2011 second quarter ended on March 26, Apple posted net income of 5.99 billion U.S dollars or 6.4 dollars per share, compared with 3.07 billion, or 3.33 dollars per share a year ago. Its revenue reached 24.67 billion dollars, compare with 13.5 billion in the same period a year earlier.

Analysts polled by Thomson Reuters gave an average estimate of 5.35 dollars earning per share on revenue of 23.3 billion.

"With quarterly revenue growth of 83 percent and profit growth of 95 percent, we're firing on all cylinders," said Steve Jobs, Apple's CEO. "We will continue to innovate on all fronts throughout the remainder of the year."

As the most valuable business for the company, Apple sold 18.65 million iPhones in the second quarter, representing 113 percent unit growth over the year-ago quarter. In February, Apple announced that iPhone4 would come on Verizon network, enabling it to attract some 90 million Verizon subscribers to adopt the popular smartphone.

The company sold 3.76 million Macs during the quarter, a 28 percent increase over the year-ago quarter, and 9.02 million iPods during the quarter, representing a 17 percent unit decline from the year-ago quarter.

The company also sold 4.69 million iPads during the quarter, which is below analysts' projection. Analysts said Apple could have sold more tablets without supply constraints.

Wall Street analysts estimated sales of iPad to reach about 6 million in the fiscal second quarter, alongside about 16 million iPhones and 3-4 million Macs.

Apple also reported a gross margin of 41.4 percent compared to 41.7 percent in the year-ago quarter. Analyst said the decline of Apple's gross margins can be attributed to two reasons. One reason is the introduction of iPad in 2010 as it is a lower gross margin product than the iPhone. The other is the decline of iPhone margins over years.

Supply chain related issues have been analysts' concern in the past quarter as Apple indicated in the Q1 earnings conference call that it could have sold more iPhones and faced some supply related issues. Meanwhile, the Japanese earthquake created more supply related issues for the company as its Japanese suppliers Mitsubishi Gas Chemical and Toshiba are both temporarily shut down to assess damage from the natural disaster.

For the third fiscal quarter, Apple CFO Peter Oppenheimer gave an estimated revenue of about 23 billion and profit of 5.03 dollars per share.

Source: Xinhua
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