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Business

Apple’s third quarter earnings shine

Text by Eric Olander

Latest update : 2010-07-21

Apple easily beat Wall Street estimates with a 61 percent jump in quarterly revenue, pushing aside concerns over the iPhone's recent antenna problems. Apple is now predicting even better results for the rest of year.

Customers are snapping up Mac computers, iPad tablets and iPhones almost as fast as the company can make them, propelling Apple to easily exceed Wall Street expectations for its fiscal third quarter earnings. 

Quarterly net income surged 78 percent to 3.25 billion dollars, according to Chief Operating Officer Tim Cook, but it was the revenue report that really surprised investors. Apple smashed expectations with a 61 percent jump in quarterly revenue to 15.7 billion dollars, a billion dollars more than what Wall Street had anticipated. 

France24 Talking Points: the iPhone 4 controversy

Apple’s impressive results were driven by gains across its increasingly diverse product line. The company sold just under 3.5 million Mac computers, 3.27 million iPads and 8.4 million iPhones from April to June. A large part of the growth is coming from international markets with double and even triple-digit sales jumps in Europe and Asia respectively. "Let me be very clear on this. We're selling every unit we can make," Cook said.

 
'Antennagate?'
 
Apple has come under scrutiny for its handling of antenna problems on its new iPhone 4. While the issue may be a public relations headache for the company, there is little evidence the controversy has had any impact to the bottom line. 
 
The phone is Apple’s most important product line, yielding one third of its revenue. Analysts are predicting even stronger iPhone growth as the device makes it way into new markets around the world. "These numbers will go a long way to make people forget about any antenna issues," said Edward Jones analyst Bill Kreher. "As media tension wanes, investors will start to focus more on long-term earnings power."
 
Analysts expect Apple to sell 13 million iPads this year
If investors were not happy enough with the results, the company has promised more good news to come. Notoriously conservative with its forward earnings guidance, Apple again surprised investors by revealing that revenue for the current quarter will once again beat Wall Street’s expectations. Strong iPhone and iPad sales are driving fiscal fourth quarter revenue to 18 billion dollars, exceeding the Street’s predictions by a billion dollars.

 

Date created : 2010-07-21

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