Apple profit jumps 36%
Apple Inc. said Wednesday that consumers shrugged off economic worries and kept buying Macintosh computers and iPods during its last quarter.
Apple reported a 43% jump in revenue and a 36% gain in profit for its fiscal second quarter, mostly because its Mac sales far outpaced those of the overall computer industry.
The Cupertino, Calif., company said it sold 2.29 million Macintosh computers in the quarter, up 51% from the same period last year -- the strongest quarterly growth rate in about 20 years. Industrywide, personal computer sales rose an anemic 3.5% during the same period, according to research firm IDC.
“It’s an indicator of their expanding brand power around the world,” said Andy Hargreaves, research analyst with Pacific Crest Securities.
Apple also announced Wednesday that it planned to buy P.A. Semi Inc., a small Santa Clara, Calif., chip designer known for energy-efficient, high-performance microprocessors.
Apple’s financial results beat the expectations of Wall Street, which had worried that the company would falter as consumers closed their wallets in a tough economic climate.
Revenue hit $7.51 billion, compared with $5.26 billion a year earlier. Profit reached $1.05 billion, or $1.16 a share, up from $770 million, or 87 cents a share. Analysts surveyed by Thomson Financial had expected the company to post earnings of $1.07 a share and revenue of $6.96 billion.
“With over $17 billion in revenue for the first half of our fiscal year, we have strong momentum to launch some terrific new products in the coming quarters,” Apple Chief Executive Steve Jobs said.
Apple shares gained $2.69, almost 2%, to $162.89 then slipped to $162.31 in after-hours trading.
Industry analysts have looked to iPod sales to gauge consumer confidence. The company sold 10.6 million of the portable media players during the quarter, about the same as last year. Revenue from iPods rose 8% to $1.8 billion, an indication that consumers were buying more expensive versions such as the iPod Touch.
Apple said it sold 1.7 million iPhones -- the combination cellphone, iPod and Internet device -- and remained on track to sell 10 million by year-end.
The company doesn’t break out sales of music, TV shows and movies from its iTunes store. But in a category that includes iTunes, Apple reported $881 million in revenue, up 35% from last year. ITunes surpassed Wal-Mart Stores Inc. in February to become the No. 1 U.S. music store.
But the Mac’s resurgence has driven Apple’s financial gains. Mac sales were up 51%, compared with a 36% jump during the same period last year. Chief Operating Officer Tim Cook said sales to educational customers jumped the most in eight years.
According to IDC, Apple now has 6% of the U.S. personal computer market, up from 4.9% a year earlier. It trails Dell Inc., Hewlett-Packard Co. and Acer Inc.
In January, the company revitalized its Mac offerings with the ultra-thin MacBook Air. Although Apple did not provide sales data, Cook said the new Mac “seems to have universal appeal.”
Apple’s shares have been on a roller-coaster ride, soaring to near $200 at the end of December, falling as low as $119, and rebounding in the last month.
Analyst Shaw Wu of American Technology Research Inc. lowered his rating on the stock Monday, from “buy” to “neutral,” because he said the stock was too volatile.
“Our opinion of the company is still very high,” Wu said. “We expected a strong quarter and they delivered a strong quarter. The results show Apple’s strength in this uncertain economy.”
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