SAN FRANCISCO: Blockbuster sales of the iPhone and strong Asian business again helped Apple Inc crush Wall Street's expectations, driving its shares up more than 7 percent to record highs on Tuesday, July 19.
Sales of its iconic products far outpaced forecasts, helping drive a near-doubling of revenue in the fiscal third quarter. Its shares leapt to a high of $405 after a brief after-hours trading suspension.
Apple sold 20.34 million iPhones during the quarter versus an expected 17 million to 18 million, which analysts say helped it vault past Nokia and Samsung Electronics to become the world's biggest smartphone maker.
That "figure may indeed make them the largest smartphone maker by volume, which is somewhat ironic in a quarter that many thought would be about the Mac," said CCS Insight analyst John Jackson. "That they accomplished this without a new model speaks volumes about both their strength and the relative challenges facing competitors."
Apple's earnings beat was spectacular even by its own lofty track record. Its quarterly EPS beat the average forecast by 33 percent, versus beats of about 20 percent in the past two quarters.
The stellar results came as concern over iPad 2 supply constraints eased, with Chief Financial Officer Peter Oppenheimer saying more than 1 million iPads remained in stock at the end of June.
In coming months, Apple is expected to roll out a new iPhone, which is likely to give the world's most valuable TECHNOLOGY [] company another shot in the arm and offer a stiff challenge to rivals such as Google Inc and Research in Motion.
"They never cease to amaze me, these guys," YCMNET Advisors Chief Executive Michael Yoshikami said. "The numbers are obviously very strong and they seem to be accelerating earnings on all fronts."
ASIA ON FIRE
The Cupertino, California company said its fiscal third-quarter revenue rose to $28.57 billion, trouncing the average analyst estimate of $24.99 billion, according to Thomson Reuters I/B/E/S.
Oppenheimer attributed the big margin boost to higher sales of the iPhone, particularly in Asia. International sales accounted for 62 percent of the quarter's revenue.
Executives told analysts they were particularly optimistic about China, where Apple was only "scratching the surface." Asia Pacific revenue more than tripled to $6.3 billion in the quarter.
The iPhone "did very, very well in each of our geographic segments but Asia was on fire," he said.
Apple sold 9.25 million iPads and 3.95 million Mac computers. Gross margin for the quarter came to 41.7 percent.
Shares of Apple have emerged from the limbo they had fallen into after Chief Executive Steve Jobs took leave last January for unspecified medical reasons.
The stock price has gained nearly 19 percent since hitting a year low on June 20. The rally has added $54.8 billion to Apple's market cap since then.
On Tuesday, Jobs' health again came to the forefront after the Wall Street Journal reported that several Apple board members had discussed a successor to the Silicon Valley icon, and talked it over with at least one head of a high-profile tech company.
Succession planning at Apple has been a hot topic since Jobs announced his medical leave, with many not expecting him to return to lead the company he founded in 1976.
The fate of Apple is tied to how the iPhone and iPad maker handles the eventual departure of its iconic chief. Chief Operating Officer Tim Cook is overseeing day-to-day operations.
Shareholders representing almost a third of Apple's stock voted in February in favor of a proposal to disclose a succession plan for Jobs, underscoring worries over who will replace the visionary leader at the helm.
Apple, notorious for its conservative forecasts, estimated earnings for the September quarter of $5.50 a share on revenue of $25 billion, which came in lower than analysts' average estimate of $6.45 a share on revenue of $27.7 billion. - Reuters
Sales of its iconic products far outpaced forecasts, helping drive a near-doubling of revenue in the fiscal third quarter. Its shares leapt to a high of $405 after a brief after-hours trading suspension.
Apple sold 20.34 million iPhones during the quarter versus an expected 17 million to 18 million, which analysts say helped it vault past Nokia and Samsung Electronics to become the world's biggest smartphone maker.
That "figure may indeed make them the largest smartphone maker by volume, which is somewhat ironic in a quarter that many thought would be about the Mac," said CCS Insight analyst John Jackson. "That they accomplished this without a new model speaks volumes about both their strength and the relative challenges facing competitors."
Apple's earnings beat was spectacular even by its own lofty track record. Its quarterly EPS beat the average forecast by 33 percent, versus beats of about 20 percent in the past two quarters.
The stellar results came as concern over iPad 2 supply constraints eased, with Chief Financial Officer Peter Oppenheimer saying more than 1 million iPads remained in stock at the end of June.
In coming months, Apple is expected to roll out a new iPhone, which is likely to give the world's most valuable TECHNOLOGY [] company another shot in the arm and offer a stiff challenge to rivals such as Google Inc and Research in Motion.
"They never cease to amaze me, these guys," YCMNET Advisors Chief Executive Michael Yoshikami said. "The numbers are obviously very strong and they seem to be accelerating earnings on all fronts."
ASIA ON FIRE
The Cupertino, California company said its fiscal third-quarter revenue rose to $28.57 billion, trouncing the average analyst estimate of $24.99 billion, according to Thomson Reuters I/B/E/S.
Oppenheimer attributed the big margin boost to higher sales of the iPhone, particularly in Asia. International sales accounted for 62 percent of the quarter's revenue.
Executives told analysts they were particularly optimistic about China, where Apple was only "scratching the surface." Asia Pacific revenue more than tripled to $6.3 billion in the quarter.
The iPhone "did very, very well in each of our geographic segments but Asia was on fire," he said.
Apple sold 9.25 million iPads and 3.95 million Mac computers. Gross margin for the quarter came to 41.7 percent.
Shares of Apple have emerged from the limbo they had fallen into after Chief Executive Steve Jobs took leave last January for unspecified medical reasons.
The stock price has gained nearly 19 percent since hitting a year low on June 20. The rally has added $54.8 billion to Apple's market cap since then.
On Tuesday, Jobs' health again came to the forefront after the Wall Street Journal reported that several Apple board members had discussed a successor to the Silicon Valley icon, and talked it over with at least one head of a high-profile tech company.
Succession planning at Apple has been a hot topic since Jobs announced his medical leave, with many not expecting him to return to lead the company he founded in 1976.
The fate of Apple is tied to how the iPhone and iPad maker handles the eventual departure of its iconic chief. Chief Operating Officer Tim Cook is overseeing day-to-day operations.
Shareholders representing almost a third of Apple's stock voted in February in favor of a proposal to disclose a succession plan for Jobs, underscoring worries over who will replace the visionary leader at the helm.
Apple, notorious for its conservative forecasts, estimated earnings for the September quarter of $5.50 a share on revenue of $25 billion, which came in lower than analysts' average estimate of $6.45 a share on revenue of $27.7 billion. - Reuters
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