Apple reported 2015 first quarter fiscal earnings for the fourth quarter of 2014 that easily surpassed analysts’ estimates and set an all time record for revenue, boosted by strong demand for the new iPhone 6 which also set an all time record high for unit sales.
Apple CEO Tim Cook expressed gratitude to Apple customers whose purchases in the final holiday quarter of 2014 helped the Cupetino, California company to reach new heights.
“We’d like to thank our customers for an incredible quarter, which saw demand for Apple products soar to an all-time high,” said Tim Cook, Apple CEO during the conference call.
Cook acknowledged that Apple had record new customers to iPhone and more Android switchers than in the previous 3 launches.
“In aggregate, we saw more new customers to iPhone than we’d ever seen before. We had higher rate of Android switchers than we had in three previous launches” Cook said.
For the quarter, Apple reported revenue of $74.6 billion, a 30 percent increase over last year, and a net profit of $ 18 billion, a 38 percent bump, and above the previous record by almost $5 billion which easily outperformed revenue of $57.6 billion and a net profit of $13.1 billion in the same quarter last year, amounting to an increase of 48 percent in earnings per share.
Gross margin was 39.9 percent compared to 37.9 percent in the same quarter last year.
CEO Tim Cook admitted that a strengthening U.S. dollar during the past few months impacted Apple’s international sales which accounted for 65 percent of the quarter’s revenue.
“It goes without saying, a strong US dollar has a negative impact on our international business” Cook said.
The United States generated the highest revenue for Apple last quarter with $30,566 billion followed by Europe at $17,214 billion and China at $16,144 billion, marking a 70 percent increase.
The iPhone continues to be the highest source of revenue for Apple by a wide margin compared to its other products.
For the quarter, the iPhone generated $51,182 billion in revenue trailed distantly by iPad revenue of $ 8,985 billion and Mac revenue of $ 6,944 billion.
According to IDC, Android had the largest market share of smartphones in 2014 with 66.6 percent followed by Apple’s iOS at 30.4 percent, Microsoft’s Windows at 2.0 percent, and others at 0.9 percent.
Apple sold a record 74.5 million iPhones during the past quarter, representing 46 percent growth over last year.
Unit sales increased 44 percent in the U.S. and 97 percent in BRIC countries.
Sales doubled year over year in China, Brazil and Singapore.
Revenue from I-Tunes, software, and services grew at a double digit rate.
Although Cook claimed that essentially over 80 percent of commerce on tablets is on the iPad, the latest quarterly results for the iPad were not stellar.
For the quarter 21.4 million units were sold compared to 26 million last year.
However, Mac sales performance was good for the quarter which saw 14 percent growth, reaching a record revenue of $6.9 billion.
Cook said that Mac saw double digit year over year unit growth despite the contraction of the global PC market which declined 3 percent for the quarter.
Apple Pay and Apple Watch
Cook claimed that “2015 will be the year of Apple Pay” and confirmed that Apple Pay is already off to a good start.
“Feedback is extremely positive. Today, 750 banks and credit unions have signed on to bring Apple Pay to their customers. Three months after launch, Apple Pay makes up more than 2 of 3 purchases using contactless card payments across Visa, MasterCard, American Express.
Cook said that the new Apple Watch, the first new product since the iPad in 2010, will be shipped in April.
Forward guidance in the next March quarter includes revenue between $52 and $55 billion versus $46 billion a year ago.
Gross margin between 38.5 percent and 39.5 percent.
Operating expenses between $5.4 billion and $5.5 billion.
Concerning forward guidance, Cook admitted that he’s “bullish” on the prospects for the iPhone.
“You can see from the March guidance that we’ve given that we’re bullish about iPhone going forward. We believe that it’s the best smartphone in the world, our customers are telling us that, the market is telling us that. We’re doing well in virtually every quarter of the world” Cook said.
-Johnathan Schweitzer * Note: The paypal icon located at the top of this page is not for decoration. Please consider donating to this site.