Cupertino, California-based revolutionary gadget maker Apple (AAPL) again reminded how the company plays in a league of its own, far above any other tech behemoth, as it came out with its fiscal 2014 fourth quarter earnings. Not only did the company exceed the Street's expectations, it also topped its own guidance. That's something! On the back of the never ending and filthy demand for its latest iPhones, Apple pulled off a fabulous quarter and everything is hinting at the possibility of an even more successful fourth quarter as buyers across the world enter the biggest holiday season.
The tempting bag of Apple's numbers During the earnings call, CEO Tim Cook said, "We generated our strongest revenue growth rate in seven quarters, far surpassing our expectations we communicated in July and establishing a new record for Apple's September quarter revenue."
The iPhone-maker reported consolidated revenues of $42.1 billion, up 12% from prior year period's $37.4 billion. The bottom line also impressed the investors as it came to $8.5 billion, translating to diluted earnings per share of $1.42, up 20% year-over-year. Obviously all this was possible because of the outstanding margins the company reported: gross margin was 100bps higher at 38% over last year, and operating margin came to $11.2 billion or 26.5% of total revenues.
A look at the iOfferings As always, Apple's fourth quarter was characterized by a series of new launches, the best one being the iPhone. Apple introduced the much anticipated iPhone 6 and the iPhone 6 Plus, and boy oh boy, what response the devices got. With each passing year, the craze for iPhones have gone up, but what happened this time was beyond expectation.
During the three months period, Apple sold 39.3 million iPhones, up by 5.5 million devices compared to last year when it launched the iPhone 5S and the 5C. Apple even set a new fourth quarter record for iPhone as the segment revenue surged by 21% over the previous year.
Cook was proactive to praise Apple's operational team and said, "Our operational team has done an extraordinary job executing the manufacturing ramp throughout the entire supply chain. Today we've launched in 32 countries including China and our new iPhones will be shifting in 69 countries and territories by the end of this month, making this our fastest and most successful iPhone launch ever."
Apple also launched the latest iPads – iPad Air 2 and iPad Mini 3. While several analysts felt the demand for the tablets are not up to scratch, Apple said its expectations from iPads were met. The company is also happy about its latest iMac with Retina 5K Display. The latest Mac devices are being powered by the revolutionary OS X Yosemite that brings to the devices new age "design and continuity features that deliver an even more fluid experience across all of our iOS devices and Mac." Even Apple Pay has gained huge traction with more than 1 million credit card registrations in three days.
Now moving on to App Store and iTunes, the company reported a 36% year-over-year growth in App Store revenue on the back of rising app downloads that have topped 85 billion during the quarter. Even the iTunes revenue reached an impressive level of $17 billion.
Things look steady for the holiday season Apple is optimistic about the company's prospects for the coming quarter, particularly because it's the holiday season. For the first quarter of fiscal 2015, Apple expects total revenues to range between $63.5 billion and $66.5 billion. Market Realist pointed out that at the mid point of the range, i.e. at $65 billion, revenues will surge by 13% year on year.
So what's inspiring Apple to think so tall? Well, the demand for the new iPhones has been phenomenal and even eats the demand for the very successful iPhone 5S. Apple's optimism also has to do a lot with the Apple Watch that's expected to hit the streets soon.
With the Apple Watch, the company intends to position itself as a fashion brand and not just a tech maker. The company hasn't even once referred to the Apple Watch as a smartwatch or a gadget. That's Apple's technique of marketing it. The iPhone maker wants to position the offering as a luxury watch that will also offer the convenience of a modern day connected device. Even analysts and industry experts are very optimistic about the success of the Apple Watch.
All in all, Apple had a great end to its fiscal 2014 and now expects the best ever opening for any fiscal year so far. Its strong product lineup and the ever increasing demand for its offerings are very likely to push up Apple's performance in the near future.
About the author:Quick PenA seasonal writer with a Management Degree in Finance and interests in automotive, technology, telecommunication and aerospace sectors.| Currently 0.00/512345 Rating: 0.0/5 (0 votes) |
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