Apple ships 5.2M iPhones during quarter

Apple reported its best-ever non-holiday quarter for earnings and revenue, and trumpeted the fact that it sold 5.2 million iPhone units during the period.

[1]The smartphone and computer maker reported a net profit of $1.23 billion, up nearly 15 percent from the net profit of $1.07 billion it had in the year-ago quarter. The company posted revenue of $8.34 billion, up almost 12 percent from the $7.46 billion in revenue it had a year ago. The company said its gross margin also was up, climbing to 36.3 percent, up from 34.8 percent in the year-ago quarter.

Apple said its iPhone shipments in the quarter represented a 626 percent increase over the year-ago quarter, when it shipped 717,000 iPhone units. However, that quarter did not reflect full sales of the iPhone 3G, which went on sale in July 2008. The company released the latest incarnation of the iPhone, the iPhone 3GS, on July 19, and Apple said it sold over 1 million in its first weekend of availability.

"Recognized revenue from iPhone handset sales, accessory sales and carrier payments was $1.69 billion during the quarter, compared to $419 million in the year-ago quarter, an increase of over 300%. The sales value of iPhones sold during the quarter was $2.9 billion," said Peter Oppenheimer, Apple's CFO, according to a transcript of the company's conference call from SeekingAlpha.

Apple said it expects revenue to increase in its fiscal fourth quarter to between $8.7 billion and $8.9 billion. The numbers appeared to please investors, who sent the company's shares up more than 4 percent in after-hours trading.

"I think expectations continue to be high for the company going forward especially because of the iPhone," said industry analyst Jeff Kagan.

Yankee Group analyst Carl Howe said Apple continues to print money from the iPhone. "At a time when Yankee Group data shows consumers cutting back on what they spend on connectivity services, Apple's growing revenues and profits in the current economy affirm that it's the consumer electronics leader to catch--if anyone can," he said.

Apple also confirmed the death of a Foxconn employee in China who recently committed suicide. The employee, a recent engineering graduate named Sun Danyong, jumped out of the window of his apartment Thursday. According to several Chinese media reports, including one in the Shanghai Daily, Sun had been in charge of sending iPhone prototypes to Apple, but one of them went missing. Sun was detained and beaten by a Foxconn security official in the days before his suicide, according to some of the reports.

Foxconn did respond to requests for comment from CNET or the Wall Street Journal. Foxconn manufactures parts for Apple.

Apple expressed remorse for Sun's death. "We are saddened by the tragic loss of this young employee, and we are awaiting results of the investigations into his death," Apple spokeswoman Kristin Huguet told CNET. "We require our suppliers to treat all workers with dignity and respect."  

For more:
- see this release
[2]- see this SeekingAlpha conference call transcript [3]
- see this CNET article [4]
- see this WSJ article [5] (sub. req.) [2]

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