Apple smashes Street; posts record Q3 revenue and profit

Apple today announced financial results for its fiscal 2007 third quarter ended June 30, 2007. Apple posted revenue of $5.41 billion and net quarterly profit of $818 million, or $.92 per diluted share. These results compare to revenue of $4.37 billion and net quarterly profit of $472 million, or $.54 per diluted share, in the year-ago quarter. Gross margin was 36.9 percent, up from 30.3 percent in the year-ago quarter. International sales accounted for 40 percent of the quarter’s revenue.

Apple shipped 1,764,000 Macintosh computers, representing 33 percent growth over the year-ago quarter and exceeding the previous company record for quarterly Mac shipments by over 150,000. The company also sold 9,815,000 iPods during the quarter, representing 21 percent growth over the year-ago quarter. Apple did not release an exact number of iPhones sold. Apple stated the company sold 270,000 units of “iPhone (4GB and 8GB models combined) and related products and services” which “consists of iPhones and Apple-branded and third-party iPhone accessories” in less than two days of quarter.

“We’re thrilled to report the highest June quarter revenue and profit in Apple’s history, along with the highest quarterly Mac sales ever,” said Steve Jobs, Apple’s CEO, in the press release. “iPhone is off to a great start — we hope to sell our one- millionth iPhone by the end of its first full quarter of sales — and our new product pipeline is very strong.”

“We are very pleased to report strong financial results including cash flow from operations exceeding $1.2 billion for the quarter,” said Peter Oppenheimer, Apple’s CFO, in the press release. “Looking ahead to the fourth fiscal quarter of 2007, we expect revenue of about $5.7 billion and earnings per diluted share of about $.65.”

Apple will provide live streaming of its Q3 2007 financial results conference call utilizing QuickTime, Apple’s standards-based technology for live and on-demand audio and video streaming. The live webcast will begin at 2:00 p.m. PDT on Wednesday, July 25, 2007 here and will also be available for replay.

MacDailyNews Note: Analysts’ consensus estimates for Apple’s 3rd fiscal quarter expected revenue of $5.28 billion and net income of $645.6 million, or 72 cents per share, up from $472.0 million, or 54 cents per share, for the year-ago period. Apple CFO Peter Oppenheimer’s guidance for Q3 07 expected “revenue of about $5.1 billion and earnings per diluted share of about $.66.”

5:28pm EDT: In after-hours trading, APPL shares stand at $144.83, up $7.57 from their $137.26 closing price.

Apple’s recent earnings and unit sales information:

2007:
• Q3 (ended 06/30/07): revenue $5.41 billion, net profit $818 million, 1.764 million Macs, 09.815 million iPods
• Q2 (ended 03/07/07): revenue $5.26 billion, net profit $770 million, 1.517 million Macs, 10.549 million iPods
• Q1 (ended 12/30/06): revenue $7.10 billion, net profit $1 billion, 1.606 million Macs, 21.066 million iPods

2006:
• Q4 (ended 09/30/06): revenue $4.84 billion, net profit $546 million, 1.610 million Macs, 08.729 million iPods
• Q3 (ended 07/01/06): revenue $4.37 billion, net profit $472 million, 1.327 million Macs, 08.111 million iPods
• Q2 (ended 04/01/06): revenue $4.36 billion, net profit $410 million, 1.112 million Macs, 08.526 million iPods
• Q1 (ended 12/31/05): revenue $5.75 billion, net profit $565 million, 1.254 million Macs, 14.043 million iPods

2005:
• Q4 (ended 10/11/05): revenue $3.68 billion, net profit $430 million, 1.236 million Macs, 06.451 million iPods
• Q3 (ended 07/13/05): revenue $3.52 billion, net profit $320 million, 1.182 million Macs, 06.155 million iPods
• Q2 (ended 03/26/05): revenue $3.24 billion, net profit $290 million, 1.070 million Macs, 05.311 million iPods
• Q1 (ended 12/25/04): revenue $3.49 billion, net profit $295 million, 1.046 million Macs, 04.580 million iPods

2004:
• Q4 (ended 09/25/04): revenue $2.350 billion, net profit $106 million, 836,000 Macs, 02.016 million iPods
• Q3 (ended 06/26/04): revenue $2.014 billion, net profit $61 million, 876,000 Macs, 860,000 iPods
• Q2 (ended 03/27/04): revenue $1.909 billion, net profit $14 million, 749,000 Macs, 807,000 iPods
• Q1 (ended 12/27/03): revenue $2.006 billion, net profit $63 million, 829,000 Macs, 733,000 iPods

154 Comments

  1. @Peter Lemon Jello

    In a word, yes. Apple intends to introduce the iPhone to Europe before the end of this year, and to Asia in early 2008. The market will be be much greater than just the U.S. as it is right now.

  2. @Everyone who thinks apple is having a hard time selling iPhones

    “Apple sold 270’000 iPhone in not even two full business days. Apple expects to sell the first million by the end of September. So this is just 730’000 more in three months? I hope the iPhones will sell a bit better.”

    Wow, imagine the pain. In the middle of the summer -the electronic industries historically slowest time, Apple expects to sell over a million iPhones. Those million iPhone owners will take them to work and to school. Everyone will see that they are in fact worth that dreaded $500-600 price tag. Believe me, the iPhone will be the HOTTEST CHRISTMAS GIFT OF ALL TIME!

    10 million in two Christmas’s is not to high.

  3. That iPhone number (270,000) reflects exactly twenty business hours in Q3 (i.e. in June). From Friday, 29 June at 18:00h through midnight (even that not all stores), then from 8:00h through 22:00h on Saturday. With the exception of the fifth avenue store, which is open 24/7, and was selling iPhones for all of the remaining 30 hours in June, all other stores had 20 hours at best to push as many phones as possible. If the combined total between AT&T’s and Apple’s stores is about 2,000, that means that each store had to push about 135 phones out the door in those 20 hours. That makes it an average of one phone every ten minutes.

    I have no doubt that Apple is way past one million mark. Several weeks ago, there was an article here (and elsewhere) about an insider from AT&T claiming that they have registered over 1 million iPhone users after first two weeks.

    The stock has plunged immediately after closing (thank you all sellers for the buying oportunity; yesterday, I had sold 450 shares; now, I bought 500 with that money). Shares are now back up and past the closing $137.26. Although still very volatile, many are getting back in, having digested the staggering numbers.

    Ultimately, it can’t go anywhere but up.

  4. Motorola sold 130,000 Razr’s in 30 days…Apple sold 270,000 iPhones in 30 hours. Many people didn’t wait in line and bought online. The numbers have to be much higher at this point. Keep in mind Apple sold 1 million .99cent songs their first month and it was astronimical. Anyone who really used their brain can see that 270,000 iPhones in 30 days is also astronomical, in any electronic industry, must less the cell phone industry.

  5. 270,000 phones in 30hrs = 9000/hr. Hardly poor numbers and makes me wonder how many have been sold since that cutoff point? (If I were Apple I would want to hide the true number, for no reason other than to allow competitors to maintain their false sense of security and complacency.) Can anyone name another phone that has sold anywhere near this number? The closest might be the RAZR but I’m fairly sure even their numbers would have required weeks to acheive the same. I certainly don’t recall seeing lines forming to buy any other cellphone.

    Because cellphones require a monthly/yearly commitment, most will buy when their contracts expire. The next year will show the real truth when the average person picks up the iPhone and sees for themselves what the hype is all about.

    MDN word: CAN, as in only Apple can, it seems.

  6. BTW – The Apple stated goal is 10 million units in calendar year 2008 (the first full year in the market). The numbers now don’t count toward meeting that particular goal.

    If Apple sold 270,000 in one day plus six hours, the 500,000 number during the full weekend does not seem unrealistic. It’s likely Apple has already sold its one millionth iPhone by now, but is holding back that information for some reason.

  7. I think that everyone here is missing the important number of 1.764 million Macs. This is a staggering number and the highest in company history. It blows away Q4 2006 in volume. I know everyone is concentrating on iPhone but this Mac number is the exciting one too me. The tipping point has arrived.

  8. If I read this right:

    Q1 (ended 12/27/03): revenue of $2.006 billion, net quarterly profit
    $63 million

    Q3 (ended 06/30/07): revenue $5.41 billion, net profit
    $818 million

    So profit of 818/63=12.98412698413

    Apple closed at 21.37 on 31dec03

    $21.37x$12.98= $277.38

    Did I do that correctly?

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