Apple sells 33.8M iPhones in record quarter

Apple (NASDAQ:AAPL) sold 33.8 million iPhones in its most recent quarter, slightly above a consensus of analysts and a record for the company's September quarter. Apple also posted quarterly revenue of $37.5 billion and quarterly net profit of $7.5 billion in its fiscal fourth quarter. Overall, Apple's gross margin was 37 percent, compared to 40 percent in the year-ago quarter.

iphone and ipad quarterly shipments since 2007

Click here for Apple's quarterly iPhone and iPad shipments since 2007.

Apple's financial results fell at the high range of the company's expectations: Apple said it had expected $34 billion to $37 billion in revenue and a gross margin of 36 percent to 37 percent in the quarter. However, the Wall Street Journal noted that Apple's results represented the company's third consecutive quarterly decline in earnings.

"Apple is a very healthy company," JMP Securities analyst Alex Gauna told Reuters. But "if you look at the last few quarters, and even with the guide, it's not much of a growth company."

Apple's 33.8 million iPhone sales in the quarter were up from the 26.9 million it sold in the year-ago quarter. In its fiscal third quarter 2013 the company sold 31.2 million. According to Fortune's Apple 2.0 blog, an average of 48 professional and independent analysts expected Apple to have sold 33.4 million iPhones in its most recent quarter.

During Apple's conference call with analysts, the company said it enjoyed strong iPhone sales in emerging markets across India, Latin America and Russia, as well as solid sales in the United States. As for China--an increasingly important market for smartphone makers--Apple said sales there grew 6 percent but that the company had hoped for greater growth. Apple said it expects to expand its retail effort in China to additional cities.

Apple's just-ended fiscal fourth quarter includes only eight days of sales for the iPhone 5s and 5c, its two new models that went on sale Sept. 20. The inclusion of two new models at once for the first time likely goosed Apple's sales, but Apple has yet to break down 5s and 5c sales and there have been some reports that the less-expensive 5c has not been in high demand, and that Apple has cut back production of the model.

In comments during the company's conference call with analyst, Apple CEO Tim Cook declined to comment specifically on sales of individual iPhone models, but indicated that, at time goes on, sales of Apple's less expensive iPhones--the 5c and 4S--would increase as sales of its more expensive iPhone would taper. He also reiterated that Apple had never intended to sell the iPhone 5c as Apple's entry-level iPhone; he said the iPhone 4S currently acts as the company's least-expensive phone.

"The demand is very robust," Cook said of the iPhone 5s, adding that Apple is working on addressing a "significant backlog" in supplying the device.

According to Apple's financials, the company reported an average selling price of $577 for iPhones in the quarter, and got $19.51 billion in revenue from its iPhone line. Apple CFO Peter Oppenheimer acknowledged that Apple's ASP was down 7 percent year over year, which he said was partially due to an increase in sales of less expensive iPhones.

Interestingly, Cook was asked whether wireless carriers will reduce the subsidies they pay on phones, including the iPhone. "I think carriers like to sell as many units as they can," Cook said, adding that he doesn't expect carriers' subsidies to change.

"I think we have great relationships with the carriers and I think they were very happy with the iPhone rollout," he said.

Apple also said it sold 14.079 million iPad units in the quarter, essentially flat from 14.036 million in the year-ago period and down from 14.617 million units in the fiscal third quarter.

As for its coming quarter, Apple said it expects revenue between $55 billion and $58 billion and gross margin between 36.5 percent and 37.5 percent. In its last December quarter, Apple reported $54.5 billion in revenue.

"We see significant opportunities ahead of us" in both new and existing products, said Cook. According to 9to5Mac, Cook told employees in a company memo that Apple "has never been stronger."

For more:
- see this Apple release
- see this Reuters article
- see this 9to5Mac article
- see this WSJ article (sub. req.)

Special Report: Wireless in the third quarter of 2013

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