Apple Inc.: Profit Spikes on iPhone Frenzy

Oct. 22, 2009
Macintosh computers also realize significant gains in the company's record quarter

The recession didn't stop millions of consumers from purchasing iPhones and Macintosh computers this summer, much to the delight of Apple Inc. CEO Steve Jobs whose company realized a 47% profit gain in its most recent quarter.

"We are thrilled to have sold more Macs and iPhones than in any previous quarter," said Jobs in a statement released Oct. 19.

Apple's shares reached an all-time high on Oct. 21, jumping 4% to more than $207 a share in afternoon trading, after the company announced its quarterly results two days earlier.

Profit reached $1.7 billion, or $1.82 a share, compared with $1.1 billion, or $1.26 a share, in the year-ago period. Revenue reached $9.9 billion, up from $7.9 billion last year.

Apple sold 7.4 million iPhones in the quarter ended Sept. 26, a 7% increase from the year-ago period when the company sold 6.9 million units. iPhone sales rose after the company began selling its third-generation version in June and lowered the price of the previous model.

Apple Inc.
At A Glance

Apple Inc.
Cupertino, Calif.
Primary Industry: Computers & Other Electronic Products
Number of Employees: 35,100
2008 In Review
Revenue: $32.48 billion
Profit Margin: 14.88%
Sales Turnover: 0.82
Inventory Turnover: 49.90
Revenue Growth: 35.30%
Return On Assets: 19.07%
Return On Equity: 33.27%
The company is confident that it's well ahead of competitors in the smartphone market, company COO Tim Cook told the Wall Street Journal in an Oct. 20 article.

"Frankly, I think that people are really just trying to catch up with the first iPhone that we announced two years ago, and we've long since moved beyond that," Cook said in the Journal article.

Macintosh computer sales rose 17% to 3.1 million units sold during the quarter.

The day following its earnings release, Apple unveiled a new iMac desktop line featuring 21.5 and 27-inch LED-backlit widescreen displays. The new iMac family starts at $1,199. The company says it's the fastest-ever iMac lineup with Intel Core 2 Duo processors starting at 3.06 GHz, and Core i5 and i7 quad-core processors. Each new iMac will come with a wireless keyboard and a wireless mouse.

For the year, the company said profit rose 19% to $5.7 billion, or $6.29 a share, from $4.8 billion, or $5.36 per share, reported in 2008.

The company expects revenue of $11.3 billion to $11.6 billion in first-quarter 2010 with earnings per share in the $1.70 to $1.78 range, said Apple CFO Peter Oppenheimer.

"We've got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010," Jobs said.

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