IPhone still Apple’s biggest moneymaker
Quarterly profits shatter expectations
SAN FRANCISCO – The iPhone is still the engine behind Apple’s phenomenal success, even if attention lately has been focused on its new smartwatch.
While skeptics question whether the company’s future is tied too much to one product, the iPhone’s popularity was the reason Apple turned in another blowout financial report Monday. The results far surpassed most analysts’ expectations for the first three months of the year, when sales traditionally fall from their holiday-season peak.
Apple sold more than 61 million iPhones in the quarter, accounting for more than two-thirds of its $58 billion in revenue for the three-month period and the lion’s share of its $13.6 billion in profit.
As expected, the numbers were down from the previous quarter, when holiday shoppers bought a record 74 million of Apple’s new iPhone 6, 6 Plus and older models. But the 61 million was a 40 percent increase over the number of iPhones sold in the first three months of 2014.
“We’re seeing great results all over the world,” Apple Chief Financial Officer Luca Maestri told the Associated Press, adding that iPhone sales grew 72 percent in China, where the company has big hopes for expansion.
Other products played a much smaller role. Revenue from Mac computers rose 2 percent from a year earlier, to $5.6 billion, while iPad revenue fell 29 percent, to $5.4 billion – continuing a steady decline in tablet sales.
Apple didn’t report any results for the new Apple Watch, which it began selling this month after the quarter ended. CEO Tim Cook told analysts on a conference call that he was “thrilled” with customer response, but added that it’s difficult to gauge demand because initial supplies are limited. Analysts estimate about 2 million have sold to date, suggesting early demand is healthy but not of blockbuster proportions.
The iPhone is another story. Since it began offering models with bigger screens last fall, Apple has vied with South Korea’s Samsung for the No. 1 position in the global smartphone market. By some estimates, Apple outsold Samsung in the quarter that ended in December, and analysts will be watching closely when Samsung reports its latest results this week.
As iPhone sales have surged, so has Apple’s stock. Apple shares have gained more than 50 percent over the last year, making it the world’s most valuable company. The stock closed Monday at $132.65, up 1.8 percent for the day, and was rising another 1 percent in extended trading.