Apple Q1 2011 Earnings Call

Apple has announced their financial results for the first quarter of the 2011 fiscal year, and as expected, have broken previous records by a considerable amount. Earnings have risen 78% year-over-year, due in part by the success of the iPad and iPhone 4.

CUPERTINO, California—January 18, 2011—Apple® today announced financial results for its fiscal 2011 first quarter ended December 25, 2010. The Company posted record revenue of $26.74 billion and record net quarterly profit of $6 billion, or $6.43 per diluted share. These results compare to revenue of $15.68 billion and net quarterly profit of $3.38 billion, or $3.67 per diluted share, in the year-ago quarter. Gross margin was 38.5 percent compared to 40.9 percent in the year-ago quarter. International sales accounted for 62 percent of the quarter’s revenue.

Apple sold 4.13 million Macs, 16.24 million iPhones, 19.45 million iPods, and 7.33 million iPads. Sales grew in every category except iPod unit sales, which dropped 7% (though revenue grew by 1%). Greater than expected Mac sales are being attributed to the new MacBook Air.

“Combining iPhone, iPad, iPod touch, we reached over 160 million cumulative iOS devices sales
during the quarter.”

iPhone sales grew by 86%, compared to the IDC estimates of 70%, with “88 of Fortune 100 companies testing or deploying iPhones” (80 are deploying iPads). Retail sales grew 95% to $3.85 billion, with over 50% of customers being first time Mac users.

Apple is confident that they will be able to increase device supplies for the upcoming year, though the iPhone 4 continues to have a “significant backlog“. In regards to offering the iPhone on other carriers, Tim Cook had this to say: “We’re always looking and assessing with who we should be doing business with … We’re not under contractual exclusivity anywhere in the world any longer.”

Second quarter revenue is expected to be $22 billion.

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