Apple (AAPL, Financial) left the market giants in rapture as it has presented the most important earnings report of the quarter. While the sales figures were very impressive due to the highest selling iPhone 6, 6 plus, 5s and 5c, the company boasts to have presented the best report so far. Apple's CEO, Tim Cook, stated during the earnings call, “We’d like to thank our customers for an incredible quarter, which saw demand for Apple products soar to an all-time high.” Let’s quickly get into the major highlights of the quarter which have left investors and analysts spellbound.
Looking into the quarter highlights
In the quarterly revenue report Apple claimed a profit of $18 billion, or $3.06 per diluted share out of revenue of $74.6 billion. Apple’s earnings surpassed the Street expectations of revenue around $69 billion The path-breaking company has produced EPS growth of 48% over the last year, and $33.7 billion in operating cash flow during the quarter which is indicated to be an all-time record.
Furnishing its guidance for the fiscal 2015, Apple claims revenue to be between $52 billion and $55 billion, gross margin between 38.5% and 39.5%, operating expenses between $5.4 billion and $5.5 billion, other income/(expense) of $350 million and to say the least, tax rate remains at 26.3%.
Lucrative product range boosted growth curve
There is no denying that Apple made quite a history by the most anticipated quarterly iPhone sales result. In fact, 74.5 million iPhone units were sold pushing up the growth to more than 46% over last year's similar period and creating a new record for the tech giant. Apple has crafted its own niche in making the most cutting-edge smartphones and by introducing 6 and 6 plus they added another feather to the hat. People wanted iPhones with larger screens and both 6 and 6 plus were hugely lauded by the customers at large. The avant-garde technology that they used turned out to be the most profitable ball game for the company, Cook commented during the conference: “iPhone 6 was the most popular iPhone last quarter. … But to sell 74.5 million they were all popular. There is clearly a geographic preference, some [regions] skew much higher on their preference to iPhone 6 plus to other [regions], it’s something that’s not consistent around the world.”
Apple reported 5.5 million Macs sold during the first quarter of 2015, a 14% increase when compared on a year-over-year basis. However, when compared to the last quarter, there was no increase in Mac sales, and the sales graph was rather flat. China played a vital role in the earnings lift with Apple reporting revenue of $16.1 billion in the Greater China region for the quarter. Developers have already chalked designs for Apple watches which are to take the market by storm pretty soon. With an amazing $74.6 billion in revenue, and a net profit of $18 billion, Apple boasts of 29.5% growth in revenue and 37.4% growth in net profit. Gross margin also improved by 2% to 39.5% from 37.9% reported in the same quarter last year. That’s really something to praise and beyond what the analysts’ have ever expected.
Investor rewards continue
At the conference call, Apple’s board of directors have declared cash dividend of $0.47 per share of the company’s common stock which is payable to shareholders as of February 12, 2015. Apple, on its capital return program, distributed over $8 billion to the investors during the quarter to bring total returns to investors to nearly $103 billion, of which over $57 billion has been disbursed in just the last 12 months.
Last thoughts
Apple’s upcoming quarter will witness the launch of the Apple Watch that marks its entry into the wearable market. As the CEO and the management remain optimistic on the upcoming quarter as reflected through their guidance irrespective of foreign exchange headwinds, investors and analysts are currently assured that Apple is a good investment in the long term. And the spectacular performance of the quarter has indeed put Apple’s stock in the limelight.
