Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

Summary: Apple, which has dominated headlines over news that CEO Steve Jobs would be taking another medical leave of absence, today released first quarter earnings that far exceeded expectations, driven in part by better-than-expected sales of the iPad during the holiday season.For the quarter ending December 25, 2010, the company reported a profit of $6 billion, or $6.

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Apple, which has dominated headlines over news that CEO Steve Jobs would be taking another medical leave of absence, today released first quarter earnings that far exceeded expectations, driven in part by better-than-expected sales of the iPad during the holiday season.

For the quarter ending December 25, 2010, the company reported a profit of $6 billion, or $6.43 per share, well above the EPS of $3.67 during the same quarter a year ago. Revenue for the quarter was $26.74 billion, a new record. Wall Street had been expecting earnings of $5.40 per share on revenue of $24.43 billion. (Preview, Statement. Techmeme)

In a statement, CEO Steve Jobs called it a "phenomenal holiday quarter" and said that "we are firing on all cylinders and we’ve got some exciting things in the pipeline for this year including iPhone 4 on Verizon."

Among the biggest headlines about the quarter was sales of the iPad tablet computer, which came in a 7.3 million, well above the 6.2 million that analysts had been expecting. Sales of iPhones, which came in at 16.2 million units, saw 86 percent growth over the previous year. And Mac sales were also stronger than a year ago, up 23 percent from a year ago. Sales of the iPod were down 7 percent.

On a call with analysts today, CFO Peter Oppenheimer talked iPhone and noted that the company continues to "have a sizable backlog and could have sold even more iPhones if we had been able to supply them." more if we could have supplied them."  COO Tim Cook, who was also on the call, followed up by saying that he felt good about what the company has done to meet the demand "however it's not enough. We still have a significant backlog. We're working around the clock to build more."

Cook said it feels great that demand is so high but, at this point, he said he wasn't go to predict when "supply and demand will meet. We believe the reaction and results from the Verizon customers will be huge, and so I don't want to give a prediction right now on when supply and demand will cross."

Part of the demand came from interest among businesses. Oppenheimer said:

Enterprise customers continue to embrace iPhone, with 88 of the Fortune 100 companies and also 60% of the Financial Times Europe 100 companies now testing or deploying iPhone. Strong employee demand and custom app development are fueling deployments within the corporate sector. Enterprise CIOs continue to add iPhone to their approved device list worldwide.

He also noted that more than 80 percent of the Fortune 100 are now deploying or piloting iPad, as well, up from 65 percent in the previous quarter. He said:

We continue to see great enthusiasm for iPad from consumer, business and education customers. Employee demand for iPad in the corporate environment remains strong and the response to the product continues to be significant. Enterprise CIOs are adding iPad to their approved device list at an amazing rate.

On the call, Cook was asked about the coming of tablets on other platforms, specifically those that were highlighted at CES in Las Vegas earlier this month. In his response, he highlighted what he perceived to be the shortcomings of the current competitors, which is mostly Android. As for the others, he called them "vapor" because they're not shipping yet. He said:

We'll assess them as they come out. However, we're not sitting still. We have a huge first-mover advantage and we have an incredible user experience... We're very very confident.

Among the other highlights:

  • The company generated $9.8 billion cash flow from operations during the quarter.
  • Gross margin was 38.5 percent, compared to 40.9 percent in the year-ago quarter.
  • International sales accounted for 62 percent of the quarter’s revenue.

Looking ahead, the company - which tends to be conservative with its forecasts - said that it expects revenue of about $22 billion and EPS of about $4.90.

The earnings announcement comes on the heels of an announcement by company CEO Steve Jobs that he was taking a medical leave but would remain CEO, leaving Chief Operating Office Tim Cook to manage the day-to-day operations of the company.

Analysts, in the meantime, don't seem to be as concerned about this leave as they did when Jobs, a Pancreative cancer survivor, took a six-month leave in 2009. Not only does there seem to be a succession plan in place, with Cook once again running the show, but the product lineup is in pretty solid shape, the latest development being the news of an iPhone for the Verizon network.

Shares of Apple were down - largely off the Steve Jobs news - by more than two percent in regular trading, closing at $341.14.

Topics: Collaboration, Apple, Banking

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60 comments
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  • Dude. That is like 380,000 iOS devices per day.

    Happy to be a developer for iOS.
    Bruizer
    • Yes, this is still about 20% or more better than Android

      @Bruizer: the subject.

      As to developers side, most of huge Android sales go with weak devices that do not even run Marketplace.

      As AngryBirds developer said, people on Android are not used to pay for the apps, they rather like to see these blinking ads (and this is <b>whole idea for Google so it actually not very interested in developers doing real apps without that ad-garbage</b>).
      DDERSSS
      • RE: Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

        As to developers side, most of huge Android sales go with weak devices that do not even run Marketplace.

        http://www.casella.com.tr
        ofis koltuklari
    • RE: Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

      @Bruizer
      Estimates for sales of iPads this year are as "low" as 30 million and as high as 60 million - and that is just iPads! There are going to be a lot of iOS devices wanting good apps.
      Wakemewhentrollsgone
    • Which iOS?

      @Bruizer
      iOS is horribly fragmented is about to become more so with yet another iPad resolution. :(
      NonZealot
      • Just keep telling yourself that. It helps if you rock back

        and forth and drool slightly while muttering it.
        frgough
      • How telling that you can't debate the point

        But then again, we all knew that you are incapable of debating any point.
        NonZealot
      • RE: Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

        @NonZealot <br>Android developers are already complaining about the need to develop "for more than 100 versions" and you think that iOS is fragmented? Why do you need to make inflammatory remarks about Apple and iOS? Is it a dysfunctional sexual issue with you? Why not wait until you are old enough to have sex before returning to these fora . . . and by the way, masturbating as you write your drivel is not really having sex!<br><br>". . . we all knew that you are incapable of debating any point." - It would be nice if people like you were capable of a mass-debate, but in reality you are only capable of a masturbate.<br><br>And I know you are going to try to challenge me and so here is a reference for you:<br><a href="http://mobile.slashdot.org/story/10/10/14/1458200/Devs-Grapple-With-100-Versions-of-Android?from=rss" target="_blank" rel="nofollow">http://mobile.slashdot.org/story/10/10/14/1458200/Devs-Grapple-With-100-Versions-of-Android?from=rss</a>
        Wakemewhentrollsgone
      • @ptorning: Yet another Apple zealot idiot

        [i]Android developers are already complaining about the need to develop "for more than 100 versions" and you think that iOS is fragmented?[/i]

        And where did I write that Android wasn't fragmented? Are you really that much of an idiot? Seriously? You are this stupid?

        Watch, this is going to [b]BLOW[/b] your tiny little mind:

        1. Android is fragmented
        2. iOS is fragmented

        The 2 statements are not mutually exclusive. Deal with it.

        You Apple zealot idiots really take the cake. You go around to every single Android post you can find and [b]SHOUT SCREAM YELL FROTH HURL VOMIT[/b] that Android is fragmented while totally ignoring the absolute and utter mess that Jobs left in our (our meaning iOS owners) back yard.

        Stop being such [b]IDIOTS[/b] on Android related posts and maybe you wouldn't look like such an [b]IDIOT[/b] here.
        NonZealot
      • @NZ

        Blatantly idiotic statements don't merit debate, they merit ridicule.
        frgough
      • You have no points

        [i]But then again, we all knew that you are incapable of debating any point.[/i]

        Only flaggeds for you, troll.
        ahh so
      • Wouldn't it be great if you could develop for all iOS

        @NonZealot maybe we'd call it a "universal app". We could then support all iOS devices with the one codebase.

        I guess we'll have to wait;-)
        Richard Flude
      • RE: Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

        @NonZealot
        Anytime a 'newer' version comes out, there's of course going to be a bit of 'fragment' but 'horribly'? Not even close.
        THavoc
      • RE: Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

        @NonZealot How is it "horribly" fragmented? You are thinking of Android with the horrible fragmentation comment... 30+ models all different screen sizes, processors, ram, UIs, OS versions... vs iOS with 3 different screen sizes/ resolutions, 3 different processors, ram...

        I know you are more critical of Apple products to stir up the Apple fanbois and tend to overblow things but come on NZ...
        athynz
      • More lies?

        @NonZealot

        All you ever have. iOS has a single selling version on all products. Does not sound fragmented to me.
        Bruizer
  • Big new today?

    First was that Macs sales grew 23%, while the PC market grew 3%. That should end the "Mac is Dead" comments for a while.

    Second, free cash grew almost $10 Billion, leaving Apple with close to $60 Billion total. Apple could end up with around $75 Billion in free cash by the end of 2011, depending on their spending.

    Prepayment of components is also an eye opener. Dropping over a billion dollars on pre-payments indicates that Apple sees something over the next 18 months. The last time they made a major pre-payment it was for Flash and they aren't identifying the new areas.

    All in all, Apple is showing the tech sector how to do it, now we just need to see who else can start delivering.
    Ken_z
    • Sharp and Toshiba display investments were probably meant

      @Ken_z: there were reports about Apple investing huge money into built/rebuilt of production sites.

      Also, LG display and one Taiwanese production unit are still in the game.
      DDERSSS
    • RE: Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

      @Ken_z MS helps sell around 350 million units per year, compared to aPPle's 8-10 million. Talk raw numbers, not misleading percentages. The Apple Jail's inmates are forced to buy new models, as they find repairing them pricey, or the O/S support drops every time there's a change in tech, or when it seems to me, they want an extra buck from you.
      Feldwebel Wolfenstool
      • Ah, the lies of the helpless MS worshipers.

        @Feldwebel Wolfenstool

        Apple's 8-10 million units per year? Of what?

        Macs? 4.1 million units in 3 months?
        iPods? >19 million units in 3 months?
        iPhones? > 16 million units in 3 months?
        iPads? > 7 million units sold in 3 months?
        Apps? > 2 billion units sold in 3 months?

        Where did you dream up this 8-10 million units per year. And that is not "helps" sell. That is sell.

        <i>"The Apple Jail's inmates are forced to buy new models, as they find repairing them pricey"</i>

        Another lie? I have had my Mac Pro G5 repaired once at a very reasonable price (about 5% of replacement).

        <i>" or the O/S support drops every time there's a change in tech"</i>

        Still get updates on my 6+ year only dual G5. Still more lies?
        Bruizer
      • RE: Apple earnings: 7.3 million iPads, 16.2 million iPhones sold during holiday quarter

        @Feldwebel Wolfenstool
        How about a few facts, to back your clueless claims? For many years buying a service pack from Microsoft often required a new pc.
        Rick_K