Apple squeezes juice from smart phones – iPhones boost Q4 revenues

22 Oct 2008

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A 600pc increase in iPhone sales rocketed Apple’s fourth-quarter revenues and outpaced Wall Street expectations that it would have acted as a clanger for consumer electronics in a global recession.

For the fourth quarter Apple posted revenues of US$7.9bn, up from US$6.2bn a year ago.

The company delivered a net quarterly profit of US$1.14bn, up from US$904bn a year ago.

In accordance with generally accepted accounting principles (GAAP), Apple recognises revenue and cost of goods sold for the iPhone and Apple TV over their economic lives. Adjusting GAAP sales and product costs to eliminate the impact of subscription accounting, the corresponding non-GAAP measures* for the quarter are $11.68bn of adjusted sales and US$2.44bn of adjusted net income.

“Apple just reported one of the best quarters in its history, with a spectacular performance by the iPhone—we sold more phones than RIM,” said Steve Jobs, Apple’s CEO. “We don’t yet know how this economic downturn will affect Apple. But we’re armed with the strongest product line in our history, the most talented employees and the best customers in our industry. And $25 billion of cash safely in the bank with zero debt.”

Apple shipped 2.6m Macintosh computers during the quarter, representing 21pc unit growth and 17pc revenue growth on the year. The company sold 11m iPods during the quarter, representing 8pc unit growth and 3pc revenue growth year on year.

Quarterly iPhone units sold were 6.8m compared to 1.1m in the year-ago-quarter.

“We’re very pleased to have grown revenue 35pc and to have generated US$9.1bn in cash in fiscal 2008,” said Peter Oppenheimer, Apple’s CFO.

“Looking ahead, visibility is low and forecasting is challenging, and as a result we are going to be prudent in predicting the December quarter. We are providing a wide range for our guidance, targeting revenue of US$9.0 to $10bn and earnings per diluted share between US$1.06 and US$1.35.”

By John Kennedy

Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com