Apple reports strong iPhone sales, profits in Q4

22.10.2008
Apple, Inc. reported on lower than expected revenue for quarter four with a net profit of US$1.14 billion or $1.26 per diluted share on $7.9 billion in sales. Last year in the same quarter, the company made $904 million or $1.01 per diluted share against $6.22 billion in sales.

Perhaps the more surprising number was gross margin, which rose to 34.7 percent from 33.6 percent in the year-ago quarter. In the July earnings call, Apple had warned of lower gross margins because of an "unannounced product transition" which was presumably the new MacBooks. That drop in margins has not yet materialized, though the MacBooks weren't released yet by the end of the reported quarter.

Analysts gross margin to be between 32 and 33 percent.

The company sold 2.611 million Macs, representing 21 percent unit and 17 percent revenue growth year-over year, slightly below analyst estimates.

Apple also sold just over 11 million iPods, with revenue and unit growth at only 3 percent and 8 percent respectively. This is fairly unsurprising given the saturation of the mp3 player market at this point, but any growth is a good sign for the company. These numbers are right in line or just above estimates.

Impressively, Apple sold 6.892 million iPhones in the reported quarter. This was a stunning growth over the 1.119 million iPhones sold in the same Q4 quarter a year ago. The numbers are far above what analysts expected and put Apple well on its way to achieving its stated goal of selling 10 million iPhones in calendar 2008 with 9,312,000 already sold this year.