Apple reports somewhat better than expected earnings, but iPad sales fail to reach 2012 level
For the first time ever, Apple iPad sales failed to beat sales from the same quarter the year before, calling into question the company’s management of the sales and product introduction cycle for the tablet line. Earnings were somewhat better than many analysts estimates on strong iPhone sales.
Apple sold 14.6 million iPads in its third quarter of the 2013 fiscal year, less than over 17 million it managed to sell in 2012. To date Apple has sold over 155 million iPads since its original launch in April of 2010.
Apple sold 31.2 million iPhones in the same quarter, compared to 26 million a year ago. Apple will be introducing its latest model at the end of the next quarter, or in October, which would be in a different fiscal year.
Apple beat its somewhat lowered guidance for revenue: $35.3 billion versus Apple’s guidance was $34.5 billion.
Net profit was $8.8 billion, but margins declined to 36.9 percent versus 42.8 percent a year ago.
Here is the Apple press release for its third quarter earnings:
Apple Reports Third Quarter Results
CUPERTINO, California—July 23, 2013—Apple® today announced financial results for its fiscal 2013 third quarter ended June 29, 2013. The Company posted quarterly revenue of $35.3 billion and quarterly net profit of $6.9 billion, or $7.47 per diluted share. These results compare to revenue of $35 billion and net profit of $8.8 billion, or $9.32 per diluted share, in the year-ago quarter. Gross margin was 36.9 percent compared to 42.8 percent in the year-ago quarter. International sales accounted for 57 percent of the quarter’s revenue.
The Company sold 31.2 million iPhones, a record for the June quarter, compared to 26 million in the year-ago quarter. Apple also sold 14.6 million iPads during the quarter, compared to 17 million in the year-ago quarter. The Company sold 3.8 million Macs, compared to 4 million in the year-ago quarter.
Apple’s Board of Directors has declared a cash dividend of $3.05 per share of the Company’s common stock. The dividend is payable on August 15, 2013, to shareholders of record as of the close of business on August 12, 2013.
“We are especially proud of our record June quarter iPhone sales of over 31 million and the strong growth in revenue from iTunes, Software and Services,” said Tim Cook, Apple’s CEO. “We are really excited about the upcoming releases of iOS 7 and OS X Mavericks, and we are laser-focused and working hard on some amazing new products that we will introduce in the fall and across 2014.”
“We generated $7.8 billion in cash flow from operations during the quarter and are pleased to have returned $18.8 billion in cash to shareholders through dividends and share repurchases,” said Peter Oppenheimer, Apple’s CFO.
Apple is providing the following guidance for its fiscal 2013 fourth quarter:
- revenue between $34 billion and $37 billion
- gross margin between 36 percent and 37 percent
- operating expenses between $3.9 billion and $3.95 billion
- other income/(expense) of $200 million
- tax rate of 26.5%