iPad, iPhone Help Apple Obliterate Sales Records
Despite personal health problems sidelining its CEO, Apple appears to be having a very good fiscal year. The company recently reported it had experienced a whopping 78 per cent hike in quarterly profit, helped along significantly by holiday sales frenzies generated by the iPad, iPhone and various Mac computers.
According to analyst reports, Apple's net income for the first fiscal quarter increased to an incredible $6 billion from just $3.38 billion the year prior. This means a rather remarkable increase in the value of the company's shares, from $3.67 each to $6.43.
Apple's Record-Breaking Sales Surprise Analysts
Sales reportedly grew 71 per cent over that first quarter, to $26.7 billion, significantly higher than the forecasted $24.4 billion. Much of the momentum was generated by the new iPad; a reported 7.33 million units of the device were sold in its first holiday season of availability. This surprised many analysts, who had predicted sales of the tablet would be considerably lower. (Source: cnn.com)
Apple's success is not due to a single product, however. While the iPad's emergence as a must-have holiday item was certainly important in making this a calendar quarter, several other devices also sold well. Approximately 16.2 million iPhones, 4.13 Mac computers, and 19.5 million iPods sold during the fiscal first quarter.
Comparably, analyst predicted 16 million iPhones, 6 million iPads, 18.7 million iPods and 4.2 million Mac computers would sell over the same period.
Jane Snorek of Nuveen Asset Management may have said it best when she rather bluntly noted, "It was a very good quarter." Apple is the largest holding for Snorek's company.
CEO Jobs Takes Personal Leave
Still, there is concern that Apple's momentum could be sapped by the loss of its vibrant CEO, Steve Jobs, who recently announced he would take a personal leave of absence for health reasons. Jobs' health has been the subject of much speculation in the past, but in each case he has returned, arguably more energetic than before.
Analyst Barry Jaruzelski, a partner at Booz & Co., credits Jobs with running a "well-oiled machine," where "marketing and innovation are deeply embedded in the process and people, making it an institutional capability." (Source: businessweek.com)
It's unlikely Jobs' absence will have a detrimental effect on Apple's progress, particularly as it nears the emergence of Verizon Wireless as a second iPhone service provider. In recent weeks, studies have shown many cell and smart phone users are considering the purchase of an iPhone for this very reason. If Verizon can establish itself as a reliable service provider, it's quite likely sales of the iPhone will grow even more rapidly than before.
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