Apple Inc., the most valuable technology company in the world, said profit rose 54 percent from a year ago to $6.62 billion in the fourth quarter on higher sales of Macs and iPads. The earnings missed Street estimates by about twenty cents, though - a highly unusual case for Apple, who has historically beaten expectations.
Earnings per share were $7.05, up from $4.64 last year but missing the $7.24 estimate of 44 analysts recorded by Bloomberg Businessweek. Revenue in the fourth quarter was reported at a record high of $28.27 billion, compared with $20.34 billion in the same quarter of 2010, the Cupertino, California-based company said in a press release after U.S. markets closed today.
Stronger sales in some of Apple's trademark iOS devices helped boost overall revenue. iPad sales broke into the eighth digit with 11.12 million devices sold during this last quarter, marking a 166 percent increase from a year ago, and Mac sales hit 4.89 million - an all-time record, the company said. iPod sales declined 27 percent, and while iPhone sales were up 21 percent from last year to 17.07 million devices, there were fewer than expected.
Apple's stock has risen $90.42, or 27 percent, before today. After the announcement, the stock fell nearly 7 percent in after-hours trading on the Nasdaq stock market.
“We are thrilled with the very strong finish of an outstanding fiscal 2011, growing annual revenue to $108 billion and growing earnings to $26 billion,” said Chief Executive Officer Tim Cook in the press release. “Customer response to iPhone 4S has been fantastic, we have strong momentum going into the holiday season, and we remain really enthusiastic about our product pipeline.”
In its first conference call without Steve Jobs, Apple also announced that about half of iPod sales were iPod touch models, and that there were 6 million downloads of Apple's Lion operating system.
Consumers who held out on iPhone purchases to wait for the iPhone 4s, which was released after the earnings period, had a "certainly substantial" impact on the lower sales numbers, Cook said in a conference call.
Apple has faced increased competition as more companies enter the market for smartphones and tablets that serve as computer replacements. Cook said that while increasing iPad sales may disrupt demand for personal computers, it has yet to show a negative effect.
"I do believe we’re seeing cannibalization. Some people are electing to buy an iPad rather than a Mac, but a materially larger amount of people are electing to buy an iPad than a Windows-based PC, so we’re coming out very well," he said. He added that the Mac sales this quarter - the highest ever - were unbelievable. "With cannibalization like this, I hope it continues."
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