Q1 2012 Marks Yet Another Record Quarter for Apple
It has gotten to the point that one can recycle the same story every quarter about Apple’s financial results, and just plug in the latest numbers to make it current. And yet, even we jaded Apple-watchers were surprised at the company’s most recent quarter results.
For this iteration of the story of Apple’s march to world domination, here are the latest numbers: $46.33 billion in sales revenue (the analyst consensus was an expected $38.85 billion), and $13.06 billion in profits, or $13.87 per share and the fourth highest quarterly profit ever for a corporation. By comparison, in the same quarter last year Apple reported revenues of $26.74 billion and profits of $6 billion; that is, Apple’s profits for the quarter were 118 percent over those from the same quarter last year. In fact, Apple’s net income for the first fiscal quarter of 2012 was about half that
of the entire previous fiscal year. Operating margin was $17.3 billion, or 34.7 percent of revenue.
Strong growth in iPhone, iPad, and Mac sales contributed to the blowout results, with only the iPod showing a sales decline of 4 million units from the year-ago quarter — but even there, the 15.4 million iPods sold during the quarter beat the company’s own expectations. iPod touch sales accounted for over half of all iPods sold last quarter. The iTunes Store brought in revenue of $1.7 billion, and, on Christmas Day, Apple saw customers download over 140 million items.
Apple sold 5.2 million Macs last quarter, a 26 percent increase year-over-year, and set sales records for both laptop and desktop machines. By comparison, IDC projected a zero percent sales increase in the general computer market. Every geographic region saw increased Mac sales, with the Asia-Pacific segment showing a 58 percent increase. The MacBook Pro and MacBook Air led the sales charge, although desktop Macs were also reported as strong sellers. And, although no dollar figures were cited for Mac App Store sales, Apple did say that customers had downloaded over 100 million apps since it opened.
As might have been expected given the October launch of the iPhone 4S, Apple reported record-breaking iPhone sales: more than 37 million were sold in the quarter, which was 128 percent more than Apple sold in the same quarter last year, and which exceeded the overall smartphone market’s growth rate of 40 percent. Recognized revenue for sales of iPhones and accessories was $24.4 billion for the quarter, or over half of Apple’s total quarterly revenues. These numbers do not include iPhone sales into the greater China market, which only began earlier this year.
Apple sold 15.4 million iPads in the quarter, just about double its iPad sales in the year-ago quarter. Recognized revenue for iPad and accessories was $9.1 billion. Notably, educational sales accounted for 1.5 million of the total number of iPads sold — and this was before Apple announced its new iBooks textbook initiative and iBooks Author software, 600,000 copies of which were downloaded in the past week.
All told, Apple has now sold some 315 million iOS devices, with 62 million of those sales taking place in the quarter that just ended.
The Apple retail stores also did land-office business last quarter, bringing in $6.1 billion in revenue, for an average of $17.1 million in revenue per store. The stores saw an average of almost 22,000 customers walk through their doors each week last quarter. Retail store sales established records across all of Apple’s product lines.
Other tidbits of note from the announcements: iCloud now has 85 million subscribers, the iTunes App store has more than 550,000 apps available including 170,000 iPad apps, app developers earned over $700 million in the quarter, the company’s gross margin was 44.7 percent, and its cash hoard (which includes short- and long-term marketable securities) was $97.6 billion, with about two-thirds of it off-shore.
Not bad for Tim Cook’s first full quarter as CEO. Maybe Apple will survive without Steve Jobs after all.
Here's a radical thought on what to do with $13 billion in profits: Apple now has on the order of $100 billion in the bank. Intel's market capitalization is about $150 billion. Apple should buy a majority share in Intel, fire the entire board, and redesign Intel chips so they won't run Windows.
OK, that's slightly evil and not very practical. *G* But a much more interesting approach would be to buy AMD, lock, stock, and barrel; their market cap is only about $5 billion according to Yahoo Finance (today's quote). That would free Apple of any dependence on Intel chips, give them design control over their own high-performance fully Intel-compatible processors, team them with designers with more than a decade of experience beating Intel at their own game, and give them access to a network of proven fabs.
Ah, but remember that Apple actually already has their own CPUs - the A series that powers the iPhone and iPad. I'd be shocked if they weren't doing Mac OS X builds for those chips now, with an eye toward putting them in Macs in favor of Intel chips.
It's true that Apple has the A series, but they're not as powerful as the Intel and AMD CPUs, and won't be for some time. Second and far more importantly, they won't ever run Windows, and probably won't run Linux, so they lack the dual-boot capability of Intel-type CPUs. That's a huge issue from a marketing perspective.
Given how much money Apple spent for that Israeli chip company, buying AMD would be a bargain, and a great way to protect their supply chain against any future problems or strategic disagreements with Intel.
For that matter, NVidia's market cap is only about $10 billion. Wouldn't it be nice if Apple owned its own graphics company and didn't have to use those lousy Intel graphics chips in its laptops?
Remember chip technology doesn't stand still. Just as ARM processors will get more powerful over time, Intel processors will get more power efficient over time.
As for not running Windows, in case you haven't heard, Windows 8 will run natively on ARM processors. So if there are Macs in the future that will have ARM processors, chances are they will only run Windows 8 in bootcamp or a virtual environment, and not any previous versions of Windows.
Exciting year for Apple! I wonder if iPods will be the next big technology to slowly fade out. As the iPhone becomes more complex and holds more music, it seems like it will phase out the need for a portable device for music alone.
Yeah, the revenue from classic iPods has been dropping for some time now. I don't see Apple dropping them entirely any time soon, but they will undoubtedly be putting fewer resources into new models.
I see iPods moving into the realm of "wearable" computing. Kind of like the iPod Nano watches but expanding into other areas.
Slowly, very slowly....
The iPod touch is iPhone without the phone,and is enormously popular. I use mine daily, and seldom for the music aspect.
The iPod classic with a 160GB disk has no peer in the marketplace. An iPod touch with a 160GB disk would be miraculous.
(No iPhone, no data plan, $0/month.)