Apple nearly doubles its profits in iOS-driven quarter

Philip Michaels
25 April, 2012
View more articles fromthe author

The debut of the latest iPad and continued strong sales for the iPhone and Mac helped Apple nearly double its profit for the fiscal second quarter.

This morning, the company reported a net profit of US$11.6 billion on revenue of US$39.2 billion for the quarter ended March 31, 2012. Those are respective increases of 94 percent and 59 percent from the 2011 second quarter. Apple’s profit translates to earnings of US$12.30 per share, up from US$6.40 a share last year; analysts were looking for earnings of US$10.06 a share for the quarter.

All told, Apple tallied record March quarter sales for its iPad, iPhone and Mac lineups. The company also saw record results for its retail stores during what chief financial officer Peter Oppenheimer called “the most amazing March quarter that Apple has ever had”.

iPad launch
It was a big quarter for Apple’s iPhone business as the company launched the third-generation tablet on March 16 and cut the entry level price to US$399 for the iPad 2 in the US, and $429 in Australia. While those moves came late in the quarter, Apple sold 11.8 million tablets during the quarter, up from 151 percent in the year-ago period.

In terms of revenue, Apple recorded US$6.6 billion from iPad sales, up from US$2.8 billion in the year-ago quarter.
Following its March 16 launch in the US, Australia and eight other countries, the third-generation iPad is now available in 40 countries around the world.

“The new iPad is off to a tremendous start,” Oppenheimer told analysts during a conference call with Wall Street analysts, adding that it was the fastest rollout ever for an iOS device.

Apple executives also noted today that the iPad is extending the company’s reach into new markets. According to Oppenheimer, Apple sold two iPads for every Mac bought by one of its K-12 (kindergarten to Year 12) education customers in the US – and that was during a record March quarter for Mac sales.

Oppenheimer also touted the iPad’s presence in the enterprise, specifically citing the U.S. Air Force’s deployment of ‘thousands’ of iPads as technical flight bags.

“The iPad continues to open new doors to customers with whom Apple had no previous relationship,” Oppenheimer said.
“The iPad has taken off not only among consumers in a very meaningful way, but also in education and in enterprise,” Apple CEO Tim Cook added during the conference call. “It’s sort of everywhere you look now.”

iPhone sales and iOS growth
iPhone numbers were also strong for Apple during the quarter. The company sold 35.1 million phones between January and March, an 88 percent jump from year-ago iPhone sales and a record for the March quarter. That outpaced the growth of the overall smartphone market, in which sales increased 42 percent year over year.

Revenue from the iPhone grew 85 percent from last year’s second quarter to US$22.69 billion.

In particular, Apple did brisk iPhone business in the Far East. Sales more than doubled in the Asia Pacific and Japan markets, according to Oppenheimer. In China, iPhone sales increased five times from last year, helped by the iPhone 4S’s release in that country in January and the addition of China Telecom as an iPhone carrier in March.

Apple ended the quarter with the iPhone 4S available in 100 countries with 230 carriers offering the smartphone.
Looking at both the iPhone and iPad numbers for the quarter, it’s easy to see how important the iOS platform has become to Apple’s business. The two products combined for US$29.2 billion in revenue – that’s three-quarters of the revenue Apple brought in during the second quarter.

Oppenheimer says iOS device sales – which include the iPod touch – totaled 50 million during the March quarter. Apple’s cumulative iOS device sales have grown to 365 million units.

The App Store now carries more than 600,000 apps, with a third of those specifically built for Apple’s iPad.

Mac growth
Mac sales also set a March quarter record. The company sold 4 million Macs, an increase of 7 percent from the year-ago quarter. The entire PC industry grew 2 percent during the March quarter, making it six full years that Apple’s Mac business has outpaced the demand for PCs overall.

iPod sales continued their decline. Apple sold 7.7 million music players, a drop of 15 percent from the second quarter of 2011.





Leave a Comment

Please keep your comments friendly on the topic.

Contact us