The Q1 AAPL earnings beat Wall Street expectations by a huge margin, thanks to monster iPhone sales over the holidays.
Apple Inc. (Nasdaq: AAPL) reported its December quarter earnings after the market close today (Tuesday).
Apple reported earnings per share (EPS) of $3.06, blowing past the consensus forecast for $2.59. Revenue was $74.6 billion, also much higher than the $67.5 billion analysts had expected. Both are all-time record highs for the Cupertino, Calif.-based tech giant.
Investors approved. Shares of AAPL stock were up nearly 5% in after-hours trading to $114.20.
The Q1 Apple earnings represent a 48% year-over-year gain - a stunning achievement for one of the largest companies in the world. Revenue was nearly 30% higher from the same period a year ago.
Helping boost the bottom line was an increase in gross margin from 37.9% last year to 39.9%. A preference for iPhones with more memory, as well as a preference for the larger screen of the iPhone 6 Plus helped Apple improve its margins.
Apple sold 74.5 million iPhones, crushing estimates for sales of 65.7 million. That's a 46% increase over the same quarter last year. And it means that Apple is even more dependent on the iPhone. In the December quarter, the iPhone accounted for more than 68% of Apple's revenue.
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As Money Morning pointed out earlier today, there was plenty of evidence for a blowout quarter for the iPhone:
"They've been capacity constrained on the iPhone 6. They can't keep the things in stock. They would sell more if they could make more," said Money Morning Defense & Tech Specialist Michael Robinson.
Apple also sold 5.5 million Macs, a 14% increase over last year and about in line with analyst expectations. Apple's Macintosh computer business has also been quietly growing and snatching market share.
Meanwhile, iPad sales fell 18% to 21.4 million units, although that was expected. Apple has not found a way to stem drooping iPad sales, but few are worried as long as the iPhone keeps flying off the shelves.
Apple's cash increased by 15% to $178 billion. And the company still paid out $8 billion to shareholders.
Guidance for the current quarter was slightly higher than what analysts were looking for. Apple said it expects revenue of between $52 billion and $55 billion and gross margin of between 38.5% and 39.5%.
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