Record iPhone sales boost Apple again

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Record iPhone sales boost Apple again

By CAROLINE GABRIEL

Published: 20 October, 2009

READ MORE: Financial | Apple | iPhone | OSX

Record iPhone sales delivered another strong quarter of growth for Apple, which saw net profit in its Q4 rise by 46% year-on-year to $1.66bn, a record profit figure for the firm. Revenue was up by 25% to $9.87bn and gross margin improved by 1.9 points to 36.6%.

COO Tim Cook called this the "quarter of the portable" as iPhone sales rose 7% year-on-year to 7.4m units, and Mac sales jumped 17% to 2.05m, mainly on strong demand for notebooks and the release of the new Snow Leopard OS. The results beat analyst consensus forecasts of $1.3bn net income on sales of $9.2bn.

"For the full year, we grew revenue by 12% and net income by 18% in extraordinarily challenging times," said CFO Peter Oppenheimer said. Annual income rose to $5.7bn on revenue of $36.54bn. Apple is predicting revenue of between $11.3bn and $11.6bn in the current quarter, the first of its 2010 financial year, and Jobs said new products were in the pipeline for 2010, but offered no details (of course this will set off speculation about an iPad or an iPhone Nano once again).

"We are thrilled to have sold more Macs and iPhones than in any previous quarter," said Steve Jobs, Apple's CEO. "We've got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010."

The iPhone remains heavily dependent on its US carrier AT&T but Oppenheimer expects a new boost from the phone's debut in China. For Apple as a whole, 56% of sales came from north America.

Apple is one of the only companies in its segments so far to report year-on-year sales and profit gains for this quarter, the last where firms are comparing with a year-ago quarter that largely came before the crash.

The only weak spot for Apple was the iPod music player, which recorded negative growth as customers shifted to the iPhone - iPod sales fell 8% to 10.2m units.

Research firm iSuppli estimates that Apple will have gained additional smartphone market share in the current quarter. The firm expects total smartphone unit sales to increase by about 11.65 in 2009 but Apple's shipments to rise by 37% year-on-year. If it enjoys another year of similar iPhone growth, it could achieve a share of the overall cellphone market similar to the share it has in PCs - around 3.5% according to iSuppli - though it will face unprecendented levels of competition in its core smartphone bases from this fall, while overall share will depend on its ability (and desire) to penetrate lower end markets.