Apple today announced preliminary financial results for its fiscal 2006 fourth quarter ended September 30, 2006. These preliminary results may be subject to significant adjustment as a result of a likely restatement of historical results.
The Company posted revenue of $4.84 billion and net quarterly profit of $546 million, or $.62 per diluted share. These results compare to revenue of $3.68 billion and net profit of $430 million, or $.50 per diluted share, in the year-ago quarter. Gross margin was 29.2 percent, up from 28.1 percent in the year-ago quarter. International sales accounted for 40 percent of the quarter’s revenue.
Apple shipped 1,610,000 Macintosh computers and 8,729,000 iPods during the quarter, representing 30 percent growth in Macs and 35 percent growth in iPods over the year-ago quarter.
“This strong quarter caps an extraordinary year for Apple. Selling more than 39 million iPods and 5.3 million Macs while performing an incredibly complex architecture transition is something we are all very proud of,” said Steve Jobs, Apple’s CEO, in the press release. “Looking forward, 2007 is likely to be one of the most exciting new product years in Apple’s history.”
“We are pleased to have finished the year with over $10 billion in cash and to have increased annual revenue by $11 billion in the last two years,” said Peter Oppenheimer, Apple’s CFO, in the press release. “Looking ahead to the first fiscal quarter of 2007, we expect revenue of $6.0 to $6.2 billion and earnings per diluted share of $.70 to $.73.”
MacDailyNews Note: Analysts surveyed by Thomson First Call had forecast Apple to earn 51 cents a share on revenue of $4.67 billion.
Apple’s 2006 earnings and unit sales information, Q1-Q4:
• Q1 (ended 12/31/05): revenue of $5.75 billion, net quarterly profit of $565 million, 1.254 million Macs, 14.043 million iPods
• Q2 (ended 04/01/06): revenue of $4.36 billion, net quarterly profit of $410 million, 1.112 million Macs, 08.526 million iPods
• Q3 (ended 07/01/06): revenue of $4.37 billion, net quarterly profit of $472 million, 1.327 million Macs, 08.111 million iPods
• Q4 (ended 09/30/06): revenue of $4.84 billion, net quarterly profit of $546 million, 1.610 million Macs, 08.729 million iPods
In total for FY 2006, Apple has posted revenue of $19.32 billion, net profit of $1.993 billion, and sold 5,303,000 Macs and 39,409,000 iPods.
For reference, Apple’s Q4 2005:
• Q4 (ended 09/24/05): revenue of $3.68 billion, net quarterly profit of $430 million, 1.236 million Macs, 06.451 million iPods
Via Apple’s Press Release: Results Subject to Significant Adjustment
As previously announced on October 4, 2006, an independent committee investigating Apple’s stock option practices has reported its findings, which are under review by the Company and its independent auditors. The investigation determined, among other things, that stock option grants made on 15 dates between 1997 and 2002 appear to have grant dates that precede the approval of those grants for accounting purposes. As a result, management continues to believe, and the audit committee agrees, that Apple will likely need to restate its historical financial statements to record non-cash charges for compensation expense and related cash and non-cash tax adjustments relating to past stock option grants. The Company and its independent auditors are reviewing accounting guidance regarding stock option grants recently published by the SEC, and have not yet determined the amount of such charges, the resulting tax and accounting impact, or which periods may require restatement. Under applicable accounting standards, such compensation expense generally reflects the difference between an option’s exercise price and the market price of the Company’s stock at the measurement date, the point at which the terms of the option grant were actually finalized. According to the recent SEC guidance, companies must evaluate stock option grants in light of all relevant facts, circumstances and patterns of conduct to determine whether grants were actually finalized on the stated grant dates. Evidence of a practice that certain grants were not finalized on the stated grant date may require a conclusion that the grant date is not the measurement date for other grants as well. Therefore, it is possible that the Company and its independent auditors could conclude that a larger number of grant dates than previously identified could have a measurement date that differs from the grant date, which could result in significant additional non-cash stock-based compensation expense. Such charges may result in material changes to the Company’s financial statements, including those covering the periods presented in this release.
and the stock comes tumbling down. The better the news, the worse the reaction.
Everyone get ready for Troy Wolverton’s Apple doom and gloom article on thestreet.com
Lets see what some potential headlines are:
No shine for this Apple.
Apple rotten to the core.
This Apple half eaten.
Apple delivers mixed bag.
blah blah blah
Nice results, a decent upside surprise. I wonder if laptops broke 1 million.
“Looking forward, 2007 is likely to be one of the most exciting new product years in Apple’s history.”
That sounds interesting.
j, where do you see shares tumbling down? I see after hours trading at up over $5!!!
2007 will be a very interesting year indeed for Apple… I can’t wait.
“Looking forward, 2007 is likely to be one of the most exciting new product years in Apple’s history.” = iPhone
The stock didn’t come tumbling down! It’s up 5% in after-market trading.
Yeah, a fiscal year wrap-up of nearly 20 BILLION in sales and more than 10% of that being profit is pretty “small” potatoes…
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MW: results (and how!)
Half a billion reasons to continue to move toward mediocrity – the default standard of the rest of the industry.
Not much to look forward to.
what the hell are you talking about. leave the investing to us pros. LOL. stock tumbling down.
apple squeezed the same revenue out of approximately 1 billion less in revenue from Q4. WOW. that is awfully impressive.
as for j. i got a hot stock tip for you. energy company named enron…
LOL @ investing n00b3z
All right! Good Results!
Um “J IS AN IDIOT”
Did you mean that Apple generated the same profit (approximately) from 1 billion less in total revenue compared to Q1-05?
Some stock pro you are. LOL.
As for j, what website are you using, buddy? Apple is zooming up 4 bucks + after hours.
And will have a very nice day tommorrow too as the rest of the Street celebrates its knock down earnings.
Stay tuned for Q1 results! They will be very tasty.
Actually, the stock is up over $3 in afterhours trading as of this writing.
Apple’s market-share growth steadily continues. Me likey…look for more games coming to the Mac in the coming year. That is what I’m keeping my fingers crossed for. It’s one of the last hurdles for the Mac to gain bigger market-share.
I also read this story on CNN/Money. *Why* can’t an Apple story be reported without mentioning “Microsoft’s Zune”? (Yes, I know the answers…it just annoys me.)
What is impressive to me is the fact that international sales were at 40%, with only a few Apple stores outside the US and I would bet, less marketing. That just says that the rest of the world is also fed up with WinSin and is seeking an alternative solution.
Short term traders, etc. have caught on and are loving Apple. Almost guaranteed for the top to be skimmed on announcement day. Now waiting for the video iPod for Christmas season. I think the iPhone is going to need Leopard to function as the smartest smart phone and expect a simultaneous release. It would be nice to hear Steve say at the end of the January keynote. “and Leopard is shipping today”. I expect alot more of Leopard than has been revealed. Look at the changes in Panther and Tiger in one years time. Now, they have had much longer time than that with even easier home-grown development software.
It’s nice to take a big breath, pause, and smell the market share. Increased Mac sales may lead to some ennui, but I doubt it. This ascent has come at such a price.
As Connie Guglielmo reported for Bloomberg this morning:
“Estimates for Mac shipments range from 1.11 million to 1.51 million units, according to eight analysts surveyed by Bloomberg News.”
-Exceeded
“If Apple sold more than the 1.38 million units it delivered in the first quarter of 2000, quarterly Mac shipments will be at their highest since Jobs introduced the machine 22 years ago”
-New record
“Analysts on average predict sales of $4.66 billion and profit of 51 cents a share.”
-Shattered
Farmer cut his estimate (iPods) to 7.7 million units from 8.3 million.
-Bet he feels stupid
J was talking about what usually happens. Great news from Apple and the stock drops like a rock. Hopefully that doesn’t happen again.
gspank you are an idiot.
Can someone please recommend a website or Dashboard widget where I can see the after hour trading results? I’m looking for a free solution.
Thanks in advance!
J:
Buy on rumour, sell on news. That’s the conventional wisdom anyways.
So much for those falling iPod sales. They sold more this quarter than in there first record quarter. It looks like the iPod has still got it. And the Mac is getting it to now.
KenC: 1.61 million Macs, 61% were laptops, so 980,000 laptops.
Andy C., try http://finance.yahoo.com/ and enter AAPL in the field. Note that most free sites are delayed 15 minutes.