Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

Summary: Apple's June quarter was propelled by the iPhone and iPad. The company's Mac and iPod units were light relative to estimates.

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Apple crushed third quarter estimates as it sold more iPhones and iPads than Wall Street expected.

The company reported earnings of $7.31 billion, or $7.79 a share, on revenue of $28.57 billion. Wall Street was expecting earnings of $5.85 a share on revenue of $24.99 billion. On a conference call with analysts, Apple CFO Peter Oppenheimer said:

"We're extremely pleased with the momentum in our business."

Apple's June quarter was propelled by the iPhone and iPad. The company's Mac and iPod units were light relative to estimates (preview). Oppenheimer said that he was upbeat on Mac strength and the launch of Mac OS X on Wednesday. He added that iPhone momentum in Asia was "particularly robust." The iPhone is now available in 105 countries as Apple expanded its international distribution deals with carriers.

Here's the tally:

  • Apple sold 20.34 million iPhones in the quarter.
  • 9.25 million iPads were shipped, up 183 percent from a year ago.
  • 3.95 million Macs were shipped. That sum was below expectations, but analysts expected lower units due to a Mac refresh on deck.
  • 7.54 million iPod units moved in the third quarter, down 20 percent from a year ago.

For comparison, this chart highlights expectations going into the earnings report.

In other words, Apple topped iPhone unit expectations by nearly 4 million devices. Apple's iPad units were also well ahead of estimates.

Among the key points from the conference call:

  • Oppenheimer talked about a product transition in the September quarter that may hamper margins. He didn't give any further details.
  • The company cited enterprise strength for the iPhone and iPad.
  • There is some cannibalization of the MacBook from the iPad 2.

By the numbers:

  • Apple generated cash flow from operations of $11.1 billion.
  • The company projected earnings of $5.50 a share on revenue of $25 billion. Wall Street was expecting earnings of $6.45 a share on revenue of $27.7 billion. Apple historically lowballs Wall Street on guidance.
  • Research and development spending was $628 million, up from $464 million a year ago. For the nine months ending June 25, Apple has spent $1.78 billion on R&D, up from $1.28 billion for the same period a year ago.
  • Apple ended the quarter with $12.1 billion in cash and cash equivalents and another $16.3 billion in short-term marketable securities.

Here's a look at the international sales breakdown and product mix:

See also:

Topics: Apple, Banking, Enterprise Software, iPhone, iPad, Mobility

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104 comments
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  • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

    still I hate them ...
    AdnanPirota
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      @AdnanPirota What's there to hate?...
      DDiGK
      • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

        @DDiGK
        41% profit margin, virus-free talk etc...
        AdnanPirota
      • I'm pretty sure the Mac OS is still virus free

        @AdnanPirota Malware is a different story, but if you'd meant [i]that[/i] you surely would have said it. As for 41% profit margin, every [b]other[/b] PC manufacturer would kill to have that kind of pricing power, but unfortunately they don't. Of course there's a reason for that too, they simply don't make products people want to pay a premium for. Apple does, end of story.
        matthew_maurice
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      @AdnanPirota

      Well, you can hate them and still own APPL stock ;)
      Badgered
      • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

        @Badgered
        I don't buy the virus-free bull-shit talk and the ideology that Apple phones are "beautiful" or even "sexy", I mean how stupid you have to be to think that some phone is sexy?!
        AdnanPirota
      • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

        @AdnanPirota [i]I don't buy the virus-free bull-**** talk and the ideology that Apple phones are "beautiful" or even "sexy"[/i]

        You don't have to buy into it to make money off those who do.
        Badgered
      • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

        @AdnanPirota

        <i>"I don't buy the virus-free bull-**** talk and the ideology that Apple phones are "beautiful" or even "sexy", I mean how stupid you have to be to think that some phone is sexy?!"</i>

        You're saying our phones should be ugly, unappealing to look at?
        dave95.
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      @AdnanPirota obviously a lot of people don't.
      CowLauncher
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      @AdnanPirota
      With those numbers I doubt they care LOL
      Hasam1991
      • AAPL is still playing the startup game of growth.

        @Hasam1991

        Not many startups in their size class.
        Bruizer
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      @AdnanPirota

      Well yeah, the "Oh woe is me. I need mercenary lawyers and monopolistic patent lawsuits based upon the 'miracle invention' of 'parsing links' to make me competitive. Oh woe. I need a monopoly to enforce my monopolistic business plan of controlling the hardware, OS, and the software distribution of my rapidly growing, gated distribution platform/empire. " -- excuse falls flat in the face of reality. It's utter BS. And it's bad for the consumer.

      Can't claim the sky is falling if the weather is perfect in Cupertino.

      Otherwise, cheers to the Apple design team. :-) Good job! Competition made you do it, not monopolies. (Or else Microsoft should have had its way too, and crushed Apple for good.)

      I've been reading the doom and gloom on the US economy, and I'm getting fed up with the lawyers, politicians, non-innovative executives, and bankers. -- They're not going to improve the economy; cheaper consumer technology will probably be the best bet. A cheaper, better smartphone in the hands of every American should foster another economic growth spurt, since it will encourage more commercial activity, more social-economic activity, more efficiencies, and more IT jobs.
      voltrarian
      • Monopoly had nothing to do with it

        @voltrarian Microsoft grew because they produce products that people want--they weren't always large. Likewise they didnt use force to get people to buy their products. OEM's, chipmakers, etc cozied up to them because they knew Microsoft would deliver profits to them.

        Even if Microsoft could have crushed Apple for good, a new company would have emerged. After all, great designers and engineers dont just vanish if a company goes out of business.

        I do agree with your last paragraph though.
        otaddy
    • ...I hate them...

      @AdnanPirota
      Don't own any AAPL stock, eh?
      Userama
      • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

        @Userama
        of course not, I'm an IT :)
        AdnanPirota
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      Why hate them? <a href="http://www.lacarhire.net">LA Car Hire</a> <a href="http://www.ehireacar.com">Hire a Car</a>
      molly83
  • It's very good, but a little worriesome at the same time

    that Mac sales were down, (could be because of the refresh) and iPod sales are down 20%. (that's a big number)

    It looks like their two biggest cash cows are iPhones and iPads, but as competition is getteing better in these areas, you would hope that they have something new in terms of MP3 players on the horizon to take up any slack from increased competition in tablets and smartphones.

    They have plenty of time as there isn't really a worthy competitor to the iPad at the moment, but that could change next year with a 199.99 killer Android tablet or whatever.
    William Pharaoh
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      @William Pharaoh
      There's Android tabs selling for as little at 149... look around. Of course the one I saw recently was running 2.1.
      Hasam1991
    • RE: Apple Q3 a blowout: 20.34 million iPhones; 9.25 million iPads

      @William Pharaoh
      Actually, Mac sales were up, not down. They just failed to meet expectations. I suspect the iPad may be taking some sales away from Apple along with everyone else.
      lumpy_blumpkin
      • Yes, I noted that

        @lumpy_blumpkin
        [i]Mac sales were up, not down. They just failed to meet expectations[/i]

        I agree, I think consumers are willing to wait a little longer for the newer products as the older products are good enough to suit their needs until the new product hit the market 30 or 60 days later.

        It's not like having to stick with a Celeron until the new i7's come out, a Core 2 Duo is good enough to use for another couple of months. :)
        William Pharaoh