Join gaming leaders online at GamesBeat Summit Next this upcoming November 9-10. Learn more about what comes next.
Apple’s first quarter earnings came in today. Once again, Apple set a new quarterly revenue and earnings record for the company. Sales of the iPod also reached record levels for the quarter ending December 27, 2008. One number that didn’t beat many analysts’ expectations however: iPhone sales.
Specifically, Apple posted revenue of $10.17 billion GAAP and $11.8 billion Non-GAAP (for more on what that means, see this post). Quarterly profit was $1.61 billion or $1.78 per diluted share on the GAAP side — and $2.3 billion on the Non-GAAP side.
Mac sales were good as well, Apple sold 2,524,000 Mac computers in the quarter, 9 percent above the sales from a year ago.
Meanwhile, Apple sold 22,727,000 iPods in Q1, a three percent growth over the year-ago quarter, but again, a new sales record. iPhone sales jumped some 88 percent compared to a year ago, but with the sales numbers coming in at 4,363,000, that was below many analysts expectations — which tended to be in the 5 – 7 million range.
Here’s the canned quote from Apple chief executive Steve Jobs (who is on a medical leave of absence):
“Even in these economically challenging times, we are incredibly pleased to report our best quarterly revenue and earnings in Apple history — surpassing $10 billion in quarterly revenue for the first time ever,” said Steve Jobs, Apple’s CEO.
Apple’s chief financial officer Peter Oppenheimer had this to say:
“Our outstanding results generated over $3.6 billion in cash during the quarter. Looking ahead to the second fiscal quarter of 2009, we expect revenue in the range of about $7.6 billion to $8 billion and we expect diluted earnings per share in the range of about $.90 to $1.00.”
Apple’s stock has jumped just about 10 percent on the earnings new in after-hours trading.
Some notes of interest from the call:
- While Mac sales were up, that was all due to notebook sales (up over 30 percent), Mac desktop sales fell over 20 percent year-over-year
- Apple had its biggest quarter ever in terms of iTunes music sales — including the biggest sales ever for Christmas Day and Christmas week
- Apple sold 13.7 million iPhones in 2008, well ahead of its 10 million stated goal
- A total of 17 million iPhones have been sold since the originals launch in 2007
- 46.7 million visitors went to Apple retails stores in the quarter — a record
- Apple has 251 stores across 10 countries
- 25 new stores in FY09 — about half will be internationally
- Apple was down 6 percent year over year in education sales and down 10 percent in the K-12 area. Cook says this is due to the poor economy.
- Apple TV sales were up over 3 times from the year ago period, but the product remains a “hobby”
- Apple is watching the netbook market, but has no plans for an entry in the space right now
- OS X 10.6 “Snow Leopard” still has no timetable in terms of a release
The Q&A session:
- On the topic of Jobs’ health, Oppenheimer basically restated Jobs’ release and dodged the question. But the man currently running Apple, chief operating officer Tim Cook, stepped in and spoke about the company doing extremely well no matter who is running the company. He said there was extraordinary breadth and depth among Apple’s executive team and that they are “wicked smart.”
- On the topic on handset price reductions, Cook said there is clearly price elasticity, but that Apple believes the $199 level is a “compelling value and we see nothing in the marketplace that is anywhere close to it.” In other words, no $99 iPhone anytime soon.
- On the topic of guidance for the March quarter, Oppenheimer indicated that the company is still a bit unclear about where the overall economy will go, but Cook stepped in to say that he thinks things are a bit more clear now than when banks were failing left and right last quarter.
- On new iPhone markets, Cook says the iPhone is in over 70 countries, but that markets like India are a problem because iPhone sales are subsidized there. He says that Apple will make adjustments in the future to play well in these countries. “We’re not going to play in the low-end voice plan business. Our objective is not the be the unit share leader in the industry. It’s to build the world’s best phone,” Cook said.
- On netbooks and the sub-$499 market, Cook says Apple is watching that space, but that right now those products are much less powerful than customers want and have cramped keyboards and smaller displays — “but we’ll see,” Cook said.
- On Apple TV, Cook says that the product had a big pick up — sales were up over 3 times year over year — but noted that “we still consider this a hobby.” But Cook says that the movie rentals business has really help boost the device.
- On the Mac Pro, Cook says the Mac Pro percentage number is not large and that the Pro segment was down year over year.
- On OS X Snow Leopard and its timeline, Cook said there were no comments to share today.
- On cash, Apple now has over $28 billion in cash, but has no new updates on what it is going to use that for.
- On Walmart as a seller of the iPhone, Cook basically said it’s too early to tell how it’s doing so far.
- On iPhone competitors, Cook said that having different resolution screens and sizes (like the multiple Android phones will) is a problem for developers — this pretty much rules out an “iPhone nano” for the time being. He went on to say that Apple will challenge any company it thinks is infringing on its IP — which is hard to be taken any other way than a warning to Palm, whose new Pre device is the first to significantly incorporate multi-touch components since the iPhone.
VentureBeatVentureBeat's mission is to be a digital town square for technical decision-makers to gain knowledge about transformative technology and transact. Our site delivers essential information on data technologies and strategies to guide you as you lead your organizations. We invite you to become a member of our community, to access:
- up-to-date information on the subjects of interest to you
- our newsletters
- gated thought-leader content and discounted access to our prized events, such as Transform 2021: Learn More
- networking features, and more