Apple Q1: Strong iPhone sales; mixed vs. expectations

Apple Q1: Strong iPhone sales; mixed vs. expectations

Summary: Apple has released its first-quarter results for the new 2013 fiscal year, including sales over the December holiday period just gone.

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TOPICS: Apple
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Apple today announced earnings for the 2013 fiscal first quarter, which includes the three months ending December where the lucrative holiday sales were.

apple-ipad-iphone-mac
(Credit: Apple)

The Cupertino, California-based technology giant released the iPhone 5 and the iPad Mini during the peak of Hurricane Sandy, and this just-gone quarter was one week shorter than the same quarter a year earlier, making Apple's hill to climb just that little bit steeper.

Apple posted record quarterly net profit of $13.1 billion on revenue of $54.5 billion. The company was expected to hit $54.88 billion, missing analyst estimates. Earnings per share stood at $13.81 compared to $13.87 in the slightly longer 14-week first quarter a year ago.

Here are the numbers you need to know:

  • Revenue was $54.5 billion, a 17 percent increase on the same quarter a year ago

  • Net profit was $13.1 billion, flat year on year

  • Earnings per share stood at $13.81

  • Gross margin was 38.6 percent, lower than 44.7 percent on the same quarter a year ago

  • International sales accounted for 61 percent of the first quarter's revenue

  • Cash balance currently stands at $137.1 billion; $94 billion stored off-shore

  • Apple's board declared a cash dividend of $2.65 per share, payable on February 14.

The company was expected to report earnings of $13.43 per share on revenue of $54.7 billion, according to Wall Street estimates.

Shares in Apple closed 1.8 percent up at $514.15 per share on the Nasdaq. In after-hours trading, the company was down by more than 5 percent.

Key numbers from the company's sales performance this quarter (although this quarter was one week shorter than Q1 2012, so year-over-year comparisons will not be as representative):

  • iPhones: 47.8 million, up from 37 million from the same period a year ago

  • iPads: 22.9 million iPads, up from 15.4 million from the same period a year ago

  • Macs: 4.1 million Macs, down from 5.2 million from the same period a year ago

  • iPods: 12.7 million, down from 15.4 million from the same period a year ago.

iPhone sales carried the quarter, but the company failed to reach or surpass the crucial milestone of 50 million sold per quarter. Considering Apple's underperforming fourth quarter in which the company missed its earnings per share estimates--despite beating them for sales--the iPhone and iPad maker is back on track for the start of the fiscal year.

By region, as per expected, China is starting to show its soon-to-be powerhouse status as the technology giant continues to push into the region; on the most part untapped by major Western brands and companies.

  • Americas: Revenue at $20.3 billion; up by 15 percent from a year ago

  • Europe: Revenue at $12.4 billion; up by 11 percent from a year ago

  • Greater China: Revenue at $6.8 billion; up by 67 percent from a year ago

  • Japan: Revenue at $4.4 billion; up by 25 percent from a year ago

  • Asia-Pacific: Revenue at $3.9 billion; up by 10 percent from a year ago

  • Retail: Revenue at $6.4 billion; up by 5 percent from a year ago.

Looking ahead to the fiscal second quarter, Apple said it should hit revenue between $41 billion to $43 billion with a gross margin of between 37.5 percent to 28.5 percent. Operating expenses should fall between $3.8 billion and 3.9 billion.

On the post-earnings conference call, Apple chief financial officer Peter Oppenheimer said that breaking into China was one of the most important parts of the company's business, and iPhone sales doubled in the country during the quarter.

Apple also opened 11 new stores, including four in China, generating an average revenue per store of $16.3 million, thanks to a 7 percent year-on-year increase in visitors.

He added that government agencies and enterprises are issuing iPhones, notably NASA. Outside the US, more than 10,000 iPads have been deployed in the Swedish government and in the Netherlands. Barclays also rolled out 8,000 iPads, as reported late last year, which is the largest rollout in its history.

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Topic: Apple

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94 comments
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  • A couple things....

    First I just don't understand Wall Street. Usually when Apple blows away expectations I see Apple's stock price fall. Now Apple this quarter was ever so slightly below expectations and it's stock price climbs? Second WOW Apple makes this much money in a given quarter!?!

    Pagan jim
    anonymous
    • There's really nothing to understand

      It's like sports gambling. A team can win but if they don't cover the spread then the gambler that bet on that team will be p!ssed.

      The last few days, stock went up based primarily on the speculation that Apple sold over 50 million iPhones. They didn't so Wall street is disappointed. Regardless if they still sold more than over a year ago.
      MG537-23482538203179240121698430309828
      • HUGE disappointment, indeed. Only 40% iPhone and 60% iPad growth YoY

        This is truly definition of disastrous quarter, indeed.
        DDERSSS
        • 27% YoY sales growth on weekly basis also leaves *mixed* feeling

          You can not expect for giant company like Apple to grow that slow, can you?
          DDERSSS
      • A lot of speculation going around

        Stock went up because of speculation about 50 million iPhones sold just after the stock went down based on speculation that Apple was cutting supply chain orders due to low iPhone demand. Based on a lot of nonsensical articles lately in the press regarding Apple I suspect some manipulation is going on.
        non-biased
    • It's actually down again

      It opened at 508, closed at 514. but down to 488.10 in after hours trading.
      William Farrel
      • aapl is in a freefall now

        $464 and falling.

        This is a disaster.
        toddbottom3
        • Now one "Anal"yst at Forbes.com

          wants Ivey should replace Cook, http://www.forbes.com/fdc/welcome_mjx.shtml
          Lol.
          Ram U
          • I think Ballmer should replace Cook

            After all, MS's stock price is doing better than apple's.
            toddbottom3
          • LoL. :D

            n/t
            Ram U
          • In what universe

            is a 28$ stock outperforming a $450 one?
            Mac_PC_FenceSitter
          • trading 101

            um, you can buy more than 1 share.
            so unit price is not the performance metric.
            warboat
      • N/T: I see AAPL at 514.01 (+9.24)

        N/T
        ManoaHI
        • Now down even more

          $458 in after hours trading.

          Call your stock broker right now and talk him down off the ledge. Well, he is coming down from the ledge one way or another, just encourage him to use the stairs.
          toddbottom3
          • stock brokers who relied heavily on apple's stock

            are really having a hard time selling this story to their clients. if i was one of their clients i would be getting ready for major lawsuits
            Master Wayne
        • freefall

          Apple Inc.
          NASDAQ: AAPL - Jan 24 10:03am ET


          460.87-53.13‎ (-10.34%‎)
          everss02
    • Actually...

      After hours trading puts it down ~6% from EOD.

      So the iPhone is up from "37 million percent"! Well, how on earth could you beat a year like that :).
      ryansgarrett
  • Stock is down 6% in AH trading.

    Where are you seeing the rise?
    ye
    • In the article itself of course... As a rule i don't follow stock prices

      especially minute to minute.

      Pagan jim
      anonymous
      • It's currently down over 9%

        I wouldn't use ZDNet for stock information.
        ye