Apple Revs Top $57B For Quarter, iPad's Dominance Dips
Strong sales of iPads and iPhones during the holiday season helped Apple top Wall Street analysts’ financial estimates for the quarter ending in December. But the tech giant's outlook for the current quarter fell short of expectations.
Apple sold a 26 million iPads in its fiscal first quarter -- up from 22.99 million a year ago, meeting the high end of analyst expectations. Apple CEO Tim Cook had predicted the updated versions of the original iPad and smaller iPad Mini, released in October, would prove a big seller during the holidays.
The company also sold 51 million iPhones in the quarter -- up from 47.8 million a year ago -- 4.8 million Macs, compared to 4.1 million in the year-earlier period. The latest iPhone models, the flagship iPhone 5S, and lower-priced 5C were introduced in September.
Apple overall reported revenue of $57.6 billion, up 5.6% from $54.5 million a year ago. Profit came in at $13.1 billion -- or $14.50 per diluted share -- compared to a profit of $13.1 billion, or $13.81 a share, a year ago. Wall Street analysts, on average, had projected revenue of $57.4 billion -- up from $54.5 billion a year ago -- and a profit of $14.09 per share.
“We are really happy with our record iPhone and iPad sales, the strong performance of our Mac products and the continued growth of iTunes, Software and Services,” said Cook in the earnings release.
Adoption of tablets increased to 42% of adult Americans in January from 34% in September, according to Pew Research Center data, suggesting the devices made a popular holiday gift. However, the research firm has cautioned that tablet sales growth is set to slow, declining from 54% in 2013 to 22% this year, and 10% by 2017.
The iPad’s dominance is also being gradually eroded by rivals such as Samsung and Amazon offering lower-cost models built on Google’s Android platform. Android grew to an estimated 61% of tablets shipped last year, while Apple’s declined to 35% from 46%, according to IDC.
Apple on Monday estimated revenue for the quarter ending in March at $42 million to $44 million. That fell below analysts’ expectation of $46.1 billion in sales for the current quarter ending in March.
Apple’s estimate for the March quarter includes iPhone sales through China Mobile, China’s largest wireless operator, which Apple announced a deal with earlier this month. The pact gives Apple access to another 700 million subscribers in China, but a USA Today report Sunday suggested first-week iPhones sales through the carrier had gotten off to a slow start.
Apple’s light sales guidance caused the company’s stock price to fall about 6% in after-hours trading to just under $517 a share immediately following the earning announcement. Apple shares closed Monday, up 0.8% at $550.50.