TheAppleBlog

Apple announced their quarterly earnings report yesterday, including some great news surrounding iPhone and Mac sales. Steve Jobs also made an appearance on the earnings call — a rare occurrence for this type of event. Much of the financial news was centered around the screaming success of the iPhone this year. Apple’s summary of the quarter is as follows:

For its fiscal 2008 fourth quarter, Apple today posted revenue of $7.9 billion and net quarterly profit of $1.14 billion, or $1.26 per diluted share. Gross margin was 34.7%. In one of the best quarters in its history, Apple shipped 2.6 million Macintosh computers (an all-time high), 11 million iPods, and 6.9 million iPhones.

iPhone

This (financial) quarter, Apple announced sales of 6.9 million iPhones — a huge jump from a total of 6.1 million sales in the previous five quarters. This can be put down to the worldwide launch of the product, huge increase in availability, and customers upgrading to the latest 3G model. This successful quarter means that Apple has already beaten the aim of selling 10 million iPhones in 2008, even before the start of the holiday season — their busiest period of the year.

Taken from another angle, Apple is now selling more devices than RIM (the makers of BlackBerry). They sold 6.1 million, a full 700,000 fewer phones than Apple in the previous quarter. When compared by revenue, Apple is the third-largest mobile phone supplier in the world, behind only Nokia and Samsung. Considering the iPhone only launched around 15 months ago, this is a significant achievement.

In a series of post-call questions, Steve Jobs highlighted that Apple has 5,500 apps in the iPhone App Store, and that Apple should sell its 200 millionth app tomorrow. He stated that the speed of adoption was “unlike anything we’ve seen in our careers.”

Mac

While much of the talk was surrounding iPhone, Mac sales have also had a fantastic quarter. Sales are up 21 percent over a year ago to 2.6 million — more than any other previous quarter. Consider this was in a period with no new major Mac introductions, it would be logical to expect the revamped notebook lineup and holiday season will guarantee another record breaking quarter to come.

Netbooks

When questioned about the possibility and suitability of producing a Netbook, Steve shared his feeling that the iPhone could be considered an entrant into the netbook market, since it can browse the web. This, to me, echoes back to Jobs explaining how online applications would be the best possible way to develop for iPhone — before promptly turning tail and announcing the SDK. It will remain to be seen whether Apple considers a similar turn around of opinion in this developing market, as they do apparently have “some interesting ideas there if it does evolve.”

When pressed further, Jobs clarified that “We don’t know how to make a $500 machine that’s not a piece of junk, and our DNA won’t let us do it.” Not even with your new manufacturing process, ever shrinking components and your patented multi-touch technology that’s aching to be used in something more than the iPhone? We’ll see…

Economic Perspective

Obviously, the outcome of these results were always going to be used as an indicator of how Apple is weathering the first stages of an economic downturn. It would seem that initial impressions are good, though the real test will come in the long term. When challenged about the financial turbulence, Steve remarked:

I wouldn’t trade our customers for any other company’s customers in the entire world. They are some of the smartest, most product aware customers in the market and they have chosen Apple’s quality, hardware and software products. While they may postpone purchases in tough times, they are unlikely to abandon the quality and seamless integration which they have personally experienced and become accustomed to with Apple’s products.

We don’t yet know how this economic downturn will affect Apple. But we’re armed with the strongest product line in our history, the most talented employees and the best customers in our industry. And $25 billion of cash safely in the bank with zero debt. This downturn may also present some extraordinary opportunities for companies that have the cash to take advantage of them, like Apple does.

It would seem that Apple is set for another great quarter over the holiday period, in a very strong position to keep their head above the water through the difficult times ahead.

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