Apple Announces 4th Quarter Results – Too Good To Fear the Recession
October 21, 2008 |
Today Apple has announced financial results of the 4th quarter and they are better than the Wall Street analytics predicted: with 6.9 million iPhones sold and Mac sales at all times high it could hardly be better. The revenue announced is $7.9 billion and net profit is $1.14 billion. The quarterly revenue announced today brings Apple’s annual revenue for 2008 to the amount 35% higher than in the previous year.
In terms of the products sold the results translate into the mentioned above 6.9 millions of iPhones (compared to only 1.1 million of the phones shipped in the 4th quarter of the previous year though the comparison is not quite fair as we compare different generations of the iPhone), 2.6 million of Macs (21% more computers sold compared to the same period of 2007), 11 million iPods (8% year on year growth).
Actually the only figure that is impressive here is the iPhones sales (for example, for the phones Steve Jobs mentioned that Apple sold more phones than Research In Motion, BlackBerry manufacturer) while sales of Mac computers could still be higher given how many people buy new computers during the back-to-school period but even this slowed growth was enough to mark the record anyway. Besides, it could be due to consumers delaying the purchases waiting for the announcement of new MacBooks last week. But anyway the current line of products is supposed to be the best one ever for Apple so the massive sales are not exactly surprising.
International sales accounted for 41% of the company’s revenue in the fourth quarter. Apple has relationships with carriers in over 70 countries where it will eventually sell the phones. Though I’m afraid that the politics of selling Apple products in some countries at absolutely ridiculous prices will hardly help grow this share in the future.
Without any false modesty Steve Jobs mentioned this quarter was one of the best in the company’s history with record sales everywhere and impressive growth of revenues generated by these sales as well. All in all, the company’s CEO feels pretty secure facing the depression with the strong product line and $25 billion cash. Besides, even if demand for electronics slows down for high-end products manufactured by Apple, the company still has some sort of insurance for the economic downturn times with iPhone owners paying on subscription basis and Apple continuing to receive money from carriers during the entire contract period.
In addition to having strong prospects for surviving in the crisis, Apple seems to intend to help the entire industry as well – both hinting at possible increase of R&D investments and joking about hiring every engineer in the Silicon Valley to further improve its products and thus win away market share.
After such an impressive growth announced, it is understandable that after 7% drop of Apple stock in regular trading, the price recovered in after-hours trading and jumped 13%. I think it will be safe to predict the growth will continue tomorrow unless investors decide to sell because of conservative Apple’s predictions for the next quarter.
