Technology titan Apple (AAPL) laid waste to Wall Street expectations Tuesday, reporting record revenue and earnings on strong sales of the company's iPhone and iPad devices, which have proved to be massive hits with consumers. Despite lingering concerns over the iPhone 4 antenna problem, the company offered a very optimistic outlook for next quarter.
It was the strongest performance by revenue in the history of the 34-year-old company, which earlier this year surpassed erstwhile rival Microsoft (MSFT) in market capitalization. The company reported profit of $3.25 billion, a 78% increase over last year.
Investors sent Apple's shares up 5% in after-hours trading. "These numbers will go a long way to make people forget about any antenna issues," Edward Jones analyst Bill Kreher told Reuters.
Apple habitually low-balls expectations, but the firm's performance over the last eighteen months has been nothing short of extraordinary. The company's share price is up 20% so far this year and 65% over the last 12 months. Over the last three years, Apple CEO Steve Jobs has tripled Apple's revenue and quadrupled the company's earnings.
Record Results, Robust Forecast
"It was a phenomenal quarter that exceeded our expectations all around, including the most successful product launch in Apple's history with iPhone 4," Jobs said in a statement. "iPad is off to a terrific start, more people are buying Macs than ever before, and we have amazing new products still to come this year."
Apple reported earnings of $3.51 per share, far exceeding analyst expectations of $3.11, on revenue of $15.7 billion. Better yet, the company projected revenue for the next quarter to be a staggering $18 billion with earnings per share clocking in at $3.44.
Last week, Apple said it would will offer free bumper cases to customers whose iPhones lose a signal. The company said it will defer revenue of $175 million to account for the cost of the cases.
On a post-report conference call, Apple COO Tim Cook said the company hasn't seen any effect of the antenna issue on sales because, "We are selling every unit we can make. My phone is ringing off the hook with people that want more supply."
For the most recent quarter, the tech juggernaut said it sold 8.4 million iPhones, nearly 3.27 million iPads, and 3.47 million Mac computers, all ahead of analyst expectations. The Mac sales numbers was a record. Revenue from the iTunes music store topped $1 billion, a 25% increase.
Apple said it generated $4 billion in cash during the quarter. The company is sitting on a cash hoard of $46 billion.
What are stocks? Learn how to start investing.View Course »