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APPLE’S QUARTERLY PROFIT rocketed to a corporate record $18 billion (€15.87bn) at the end of last year on booming sales of big-screen iPhone models, especially in China.
The California tech titan also announced that it had sold its one billionth device powered by its iOS mobile operating system, on a day of dizzying figures — even by Apple’s high standards.
And it said that its highly anticipated Apple Watch wearable devices, unveiled last year to fanfare, are on track to begin shipping in April.
“We’d like to thank our customers for an incredible quarter which saw demand forApple products soar to an all-time high,” declared chief executive Tim Cook.
Demand for iPhone has been staggering, shattering our expectation.
Blockbuster sales of the recently released iPhone 6, in particular, are signs of huge pent-up demand for larger-screen smartphones, likely to boost sales throughout this year, according to Forrester analyst Frank Gillett.
“I would expect the surge in China and elsewhere to hold for quite a while before it settles down,” Gillett said.
People have been waiting for an iPhone with a bigger screen and smartphones are only increasing in importance in our lives.
Record
The record quarterly profit — on unprecedented revenue of $74.6 billion (€65.79b) – was driven by the sale of 74.5 million iPhones, well ahead of most analysts’ expectations.
The staggering profit topped the $15.9 billion (€14.02b) made by ExxonMobil in the second quarter of 2012, according to Standard and Poor’s, to write Apple into the history books.
As well as the larger screen iPhone 6 models, analysts credited a partnership with China Mobile as powering sales.
Sales of iPhones doubled in Greater China, its number two smartphone market, according to chief financial officer Luca Maestri.
Cook described the fevered excitement around the debut of iPhone 6 models in China as “phenomenal.”
“We are a big believer in China,” Cook said.
It is an incredible market. I think people there love Apple products.
But it was not just China: iPhone sales leapt 44 percent in the United States and doubled in Brazil.
- ‘Long run’ -
Sales of iPads dipped, but Apple set new records in the quarter for sales of Macintosh computers and revenue from digital goods bought from its App Store.
Cook remained optimistic about the long-term potential for Apple’s iPad line.
He noted that the ranks of first-time iPad buyers remain strong in China, Britain, the US and elsewhere and that the devices account for the bulk of online activity and shopping seen from tablets.
“I believe that, over the arc of time, the iPad is a great business,” Cook said.
I am thinking over the long run.
Apple and others are still trying to tune into the rhythm of the market when it comes to how long people typically own tablets before replacing them.
Cook also noted that large-screen iPhones might be nibbling at one edge of iPad sales and Macintosh computers at another edge.
He was confident that an alliance between Apple and IBM announced last year will lead to iPads becoming more enticing for workplaces.
Cook also said Apple is seeing rapid adoption of the Apple Pay mobile financial transactions system, which is synched to the latest generation of iPhone.
- ‘Win for Cook’ -
Apple Pay is limited to the United States, but the company has been barraged with requests for it from businesses in other countries, according to Cook.
“I think this is the year of Apple Pay,” Cook insisted.
Apple’s board of directors declared a cash dividend of 47 cents per share to be paid on February 12.
Apple shares rose more than five percent to $115.20 in after-market trades that followed release of the blow-out earnings figures.
Stellar iPhone 6 sales, especially in a China market considered more inclined to low-priced smartphones such as those powered by Android, are a major win for Cook, according to independent analyst Rob Enderle of Enderle Group in Silicon Valley.
“Tim Cook clearly took a position on iPhone 6 that Steve Jobs never would have taken, and it paid off magnificently,” Enderle said of Apple’s move to field the bigger screen smartphones.
“He is kicking ass.”
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€16bn profit…lots of corporation tax to be paid so…right?
Lots of corporation tax to be dodged, more likely.
Still prefer my Samsung which allows me swop out the battery if it starts to perform poorly, add huge amounts of storage via an SD card that costs 20 euro rather than the hundreds of extra euro Apple charge for an iPhone with the same internal storage and much more scope to customise the interface even without rooting.
16bn profit by a company that exists in several countries but also nowhere “for tax purposes.”
I am sure the product is great but let’s face facts by purchasing Apple goods you are supporting a company that values profit over paying it’s fair share of tax. We have to pay 100% of ours because it’s the law….remember that…
To high profits shows its all a rip off
they show it is a luxury good with a price premium
Very astute business analysis there Mick, well done.
Iphone Joan will be livid
I’m taking bets on the amount of people talking about how the other brand they prefer is superior in the comments. Over/Under is 15 commenters.
I’ll bet you’re the first to mention other brands.
Proof please anonymous man?
Peter Gavin was the first, little Jim
- sent from my iPad.
Dammit.
Good thing I bet with Journalmoney.
-sent from my fax machine.
Don’t like Apple products, have an M8 myself but have to admire Apple all the same…
Good man Tim. Keep it going. It’s still not enough.
Lend us a fiver Phil
What’s the odds that these figures were calculated by the same bunch who calculated Tesco’s profits a while back??
Sick
It could be higher… They still can’t meet demand. I just passed a Chinese Apple Store there’s at least 60 people in a makeshift market outside re-selling iPhones for people who couldn’t reserve one online.
i cannot wait to use the apple bank
How AAPL is only up 5% in after hours trading is boggling…. Numbers were astronomical – I was in China twice in 2014 and the 6 was everywhere PRE official release. They love a bit of Apple..
Look at all the corporate tax that just went past my nose and left just a delicate tantalizing scent!
That sure is a big Apple!
And the cost of the Labour to build an iPhone in a Chinese sweatshop, where it was necessary to fit suicide netting around the roof of the building,… $5 total, for a device that Apple sell for over $500….
No wonder they made $16 billion clear profit. And don’t imagine they’ll pay much tax on that either.
When politicians and mainstream economists talk about ‘competing’, or the ‘global race’, or ‘structural reforms’ (the neo liberal favourite), that labour & living conditions in China is what they want YOU to compete with…. and in a system where virtually all public/health/welfare services are privatised… can’t pay? tough…
Of course, these politicians, economists and media editors, lawyers, senior public servants etc. don’t include themselves in the ‘competition’ or ‘structural reforms’…. their pay, holidays, hours, defined & g’teed benefit pensions are not to be touched.
That is why Syriza have just been elected in Greece… because enough people have now realised this is the goal being pursued by the Euro/EU auhorities.
Their country is not different or unique – it’s just been leading the way, discovering how far the masses can be brainwashed into supporting a system totally against their majority interests.
I really hope they bring the interest free payments for 12 months to Ireland – big success in UK and US so far.
How much Tax was taken from this €16 billion? Not alot I’d imagine.. Yet It’s perfectly okay to Tax normal paying wages with PAYE,USC,PRIS and all that!
Easy to make money when it does not pay corporation tax and exploits its workers.
Hire people, promote them and let them go all within three months as January is a quiet month! No protection for employees.. P***ks
have your say