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A staggering US$46.3 billion worth of Apple products beat every market estimates on Wall Street as they reported their first quarter results for its’ 2012 fiscal year on Tuesday, 24 January 2012.
A US$13.06 billion chunk of net profit in 14 weeks puts Steve Jobs legacy as one of the highest quarterly profits on record, on par withUS’ Exxon Mobil Corporation and Gazprom OAO of Russia.
The overwhelming numbers translate to US$13.87 per diluted share compared to US$6.43 in the year-ago quarter, which posted US$6 billion net profit at a gross of US$26.74 billion.
Sales outside the United States accounted for 58% and Apple generated US$17.5 billion in cash flow from operations.
The new iPhone 4S sold 37 million units representing US$24.4 billion or more than half of the total revenue, followed by IPad selling 15.4 million or US$9.15 billion. Macbooks and IMac’s also posted increases in both quantities and gross revenue.
The new iPhone was released in October six weeks, after their inspirational figurehead for the company and co-founder Steve Jobspassed away.
Market Reactions
Michael Obuchowski, Chief Investment Officer of First Empire Asset Management, which holds some US$4 billion under management including Apple shares said the number are “unimaginable”.
“Apple’s results were tremendous… The magnitude… is very impressive,” commented Bill Kreher of Edward Jones.
Gene Munster, an analyst at Piper Jaffray Cos., said in a Bloomberg West interview he “ran out of adjectives to describe this quarter”.
CEO Ben Verwaayen of Alcatel-Lucent couldn’t help but comment saying Apple numbers are “stunning”.
“It shows that even in a time of difficult circumstances, if you have the right product and the right focus, you can make a difference,” he said in an interview for Bloomberg Television’s “Countdown”.
Beating Competition Away
Apple’s net income is much higher than Google’s revenue for the same period.
Google, the maker of Android – iPhone OS’s closest rival, posted US$8 billion revenue, a far-cry from Apple’s net profit.
BGC Financial analyst Colin Gillis referred to the event as “a monster quarter”. “There’s just a worldwide demand for Apple products”, he added.
Apple is now the world’s biggest computer maker by sales, beating Hewlett-Packard. Apple was also able to override the introduction of the Kindle Fire by Amazon, even though it is sold at half the price of the iPad.
Apple Chief Financial Officer Peter Oppenheimer, in an interview with Reuters, said “customer demand was off the charts in the quarter”.
Chief Executive Officer of Apple, Tim Cook, said the numbers could have been bigger if they had manufactured iPhones fast enough.
Expectations
CEO Cook said “Apple’s momentum is incredibly strong, and we have some amazing new products in the pipeline”.
CFO Oppenheimer is looking forward to another strong 2012 second quarter. He said,
“Looking ahead to the second fiscal quarter of 2012, which will span 13 weeks, we expect revenue of about $32.5 billion and we expect diluted earnings per share of about $8.50.”
Bloomberg predicts Apple will hold the top spot as the largest US corporation by market capitalisation inching Exxon Mobil if “the gain holds in today’s US trading”.
Apple shares closed at US$420.41 as of yesterday.
Company Spotlight
Apple is the designer of the Mac and OS X, iLife, iWork, and professional softwares and maker of gadgets such as the iMac, iPod, iPhones, and iPads. Incorporated in 1977, the company started trading on NASDAQ under the symbol “AAPL”.
References
↑ Apple Corporate Information
↑ Apple Reports First Quarter Results
↑ Apple Inc. Q1 2012 Unaudited Summary Data
↑ Apple Profit Doubles as IPhone Demand Boosts Pressure on Google
↑ Remember Steve Jobs
↑ Apple Profit More Than Doubles on IPhone
↑ Apple ‘thrilled’ by sales surge, profits blow past estimates
↑ Apple returns to form, blows Street targets away
↑ Apple Inc. Stock Financials
