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New iPhones deliver big profits for Apple

CUPERTINO: Apple said Monday its quarterly profit rose 13 percent to $8.5 billion, as revenues jumped to $42.1 billion on strong iPhone sales.

The California tech giant’s stronger-than-expected results were helped by selling more than 39 million iPhones in the quarter ending September 27

Apple said it sold more than 39 million iPhones in the quarter, boosted by the launch last month of the large-screen iPhone 6 and 6 Plus, which hit some markets on September 19. That compared with 33.8 million in the same period a year ago.

The iPhone accounted for more than $23 billion in revenue, more than half of Apple’s overall earnings for the quarter.

Sales of iPads — which may have been lower ahead of the October launch of new models — fell from a year earlier to 12.3 million, producing some $5.3 billion in revenues.

Apple also sold 5.5 million Mac computers and 2.6 million iPods in the quarter.

The results were the best ever for the September quarter, and the fiscal year that just ended “was one for the record books,” chief executive Tim Cook said in a statement.

Apple, the world’s biggest firm by market value, closed its fiscal year with a profit of $39.5 billion on revenues of nearly $183 billion.

Trip Chowdhry at Global Equities Research said Apple’s quarterly report “handsomely beats (expectations) on both top line and bottom line.

“These results validate our investment thesis Apple is a multi-year, multi-product, multi-service and multi-geography growth company.”

– Shares rise –

Apple shares rose 1.1 percent to $100.91 in after-hours trade following the results.

“Apple continues to hit it out of the park,” independent analyst Jeff Kagan said.

“Apple was showing strong growth, year after year, until a couple years ago. That’s when they fell and that lasted for a while. However Apple now appears to be back.”

Amit Daryanani at RBC Capital Markets said Apple’s guidance for the key upcoming holiday season was also ahead of most predictions.

Apple forecast revenue between $63.5 billion and $66.5 billion and gross profit margins between 37.5 percent and 38.5 percent.

“The big upside driver in the quarter was iPhone units,” Daryanani said, adding that Apple’s forecast “leaves plenty for upside surprises.”

Apple last month increased the screen size for its new iPhones, yielding to consumer preference and following a trend begun by rivals, including Samsung.

The iPhone 6 Plus is Apple’s first product in the growing market for “phablet” phones, which are increasingly replacing tablets.

Apple’s smartphone market share is strong in the US market but globally was less than 12 percent in the second quarter, ahead of the latest launch, according to research firm IDC.

As appetites for tablet have diminished, Apple’s market share has slipped to 25 percent, compared to 70 percent for the rival Android platform, according to Strategy Analytics- AFP

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