Apple's Q1 Blowout
Morbidly inclined investors and business media can speculate all they like about Apple CEO Steve Jobs’s health and Apple’s future with or without him, but in fact, the company has never been healthier. Apple (AAPL) just reported a blowout quarter, notably record revenues of $10.17 billion and record net quarterly profit of $1.61 billion, or $1.78 per diluted share. That’s quite a bit better than the estimates of analysts surveyed by FactSet Research, who saw Apple earning $1.29 a share on $10.16 billion in revenue. “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 Jobs said in a statement.
A few quick highlights from the earnings statement and investor call before the official release, appended below.
- Apple sold 22.7 million iPods and 4.4 million iPhones during the quarter.
- It shipped 2.5 million Macs.
- Looking ahead to the second fiscal quarter of 2009, the company expects revenue in the range of about $7.6 billion to $8 billion.
- The release includes no mention of Jobs’s health.
During a call to discuss Apple’s latest earnings, Steve Jobs and his health were top of mind. Indeed, the first question of the call centered around this very issue:
Q: Well, since I’m going first, I guess I’ll ask how is Steve and hope he’s doing well. And I just wanted to know how, if you’ll run the company differently with Tim or the same and if need be, if Tim — do you feel like you would be the likely candidate if the worst case scenario were to happen if Steve was unable to return.”
Apple CFO Peter Oppenheimer: Steve is CEO of Apple and plans to remain involved in major strategic decisions, while Tim runs day-to-day operations.
Apple COO Tim Cook: There is an extraordinary depth and breadth in Apple’s executive team. And it leads over 35,000 wicked smart people. We believe we’re on the face of earth to make great products, and that’s not changing. We believe in simple not complex. We believe in deep collaboration. We have the self-honesty to admit when we’re wrong. These values are so embedded in the company that we will do extremely well regardless of who has the CEO Job. I strongly believe that Apple is doing the best work in its history.
Also the focus of some discussion the possibility of an Apple netbook. Is Apple considering entering the sub-$500 netbook market? Cook says not right now. “We’re watching that space, but from our point of view, the products are based on hardware that’s not very powerful, software that’s not that good and cramped displays. We don’t think that people are going to be pleased with that. It’s a category we watch and we have some ideas for it, but we think the products there right now are inferior.”
Here’s the official release:
Apple Reports First Quarter Results
Best Quarterly Revenue and Earnings in Apple History
iPod Sales Set New Record
CUPERTINO, California—January 21, 2009—Apple® today announced financial results for its fiscal 2009 first quarter ended December 27, 2008. The Company posted record revenue of $10.17 billion and record net quarterly profit of $1.61 billion, or $1.78 per diluted share. These results compare to revenue of $9.6 billion and net quarterly profit of $1.58 billion, or $1.76 per diluted share, in the year-ago quarter. Gross margin was 34.7 percent, equal to the year-ago quarter. International sales accounted for 46 percent of the quarter’s revenue.
In accordance with the subscription accounting treatment required by GAAP, the Company recognizes revenue and cost of goods sold for iPhone™ and Apple TV® over their economic lives. Adjusting GAAP sales and product costs to eliminate the impact of subscription accounting, the corresponding non-GAAP measures* for the quarter are $11.8 billion of “Adjusted Sales” and $2.3 billion of “Adjusted Net Income.”
Apple sold 2,524,000 Macintosh® computers during the quarter, representing nine percent unit growth over the year-ago quarter. The Company sold a record 22,727,000 iPods during the quarter, representing three percent unit growth over the year-ago quarter. Quarterly iPhone units sold were 4,363,000, representing 88 percent unit growth over the year-ago quarter.
“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.