Apple today announced financial results for its fiscal 2013 second quarter ended March 30, 2013.
Apple posted quarterly revenue of $43.6 billion and quarterly net profit of $9.5 billion, or $10.09 per diluted share. These results compare to revenue of $39.2 billion and net profit of $11.6 billion, or $12.30 per diluted share, in the year-ago quarter. Gross margin was 37.5% compared to 47.4% in the year-ago quarter. International sales accounted for 66% of the quarter’s revenue.
Apple sold 37.4 million iPhones in the quarter, compared to 35.1 million in the year-ago quarter. Apple also sold 19.5 million iPads during the quarter, compared to 11.8 million in the year-ago quarter. The Company sold just under 4 million Macs, compared to 4 million in the year-ago quarter.
“We are pleased to report record March quarter revenue thanks to continued strong performance of iPhone and iPad,” said Tim Cook, Apple’s CEO, in a statement. “Our teams are hard at work on some amazing new hardware, software and services, and we are very excited about the products in our pipeline.”
“Our cash generation remains very strong, with $12.5 billion in cash flow from operations during the quarter and an ending cash balance of $145 billion,” said Peter Oppenheimer, Apple’s CFO, in a statement.
Apple is providing the following guidance for its fiscal 2013 third quarter:
• revenue between $33.5 billion and $35.5 billion
• gross margin between 36 percent and 37 percent
• operating expenses between $3.85 billion and $3.95 billion
• other income/(expense) of $300 million
• tax rate of 26%
MacDailyNews Note: Apple will provide live streaming of its Q2 2013 financial results conference call beginning at 2pm PDT/5pm EDT on April 23, 2013 at www.apple.com/quicktime/qtv/earningsq213.
MacDailyNews will cover the conference call with live notes, as usual, right here.
Ahead of the earnings report, analysts’ consensus estimates for Apple’s fiscal Q213 chad alled for EPS $9.97 and revenue of $42.4 billion.
In January, Apple had provided the following guidance for its fiscal 2013 second quarter:
• revenue between $41 billion and $43 billion
• gross margin between 37.5 percent and 38.5 percent
• operating expenses between $3.8 billion and $3.9 billion
• other income/(expense) of $350 million
• tax rate of 26%
Ahead of the earnings release, shares of Apple Inc. [AAPL] at 4pm EDT today closed up $7.33, or 1.84%, at $406.00.
MacDailyNews Note: Trading in Apple shares was halted just prior to the earnings report and are expected to resume trading at 4:50 pm EDT.
Apple More than Doubles Capital Return Program
Apple today also announced that its Board of Directors has authorized a significant increase to the Company’s program to return capital to shareholders. The Company expects to utilize a total of $100 billion of cash under the expanded program by the end of calendar 2015. This represents a $55 billion increase to the program announced last year and translates to an average rate of $30 billion per year from the time of the first dividend payment in August 2012 through December 2015.
As part of this program, the Board has increased its share repurchase authorization to $60 billion from the $10 billion level announced last year. This is the largest single share repurchase authorization in history and is expected to be executed by the end of calendar 2015. Apple also expects to utilize about $1 billion annually to net-share-settle vesting restricted stock units.
Additionally, the Board has approved a 15% increase in the Company’s quarterly dividend and today has declared a dividend of $3.05 per common share, payable on May 16, 2013 to shareholders of record as of the close of business on May 13, 2013. Apple is among the largest dividend payers in the world, with annual payments of about $11 billion.
In conjunction with the expanded return of capital program, the Company plans to borrow and expects to announce more details about this in the near future.
The management team and Board of Directors will continue to review each element of the capital return program on an annual basis.
“We are very fortunate to be in a position to more than double the size of the capital return program we announced last year,” said Tim Cook, Apple’s CEO, in a statement. “We believe so strongly that repurchasing our shares represents an attractive use of our capital that we have dedicated the vast majority of the increase in our capital return program to share repurchases.”
“We will continue to return capital to shareholders through dividends, share repurchases, and cash used to net-share-settle vesting RSUs,” said Peter Oppenheimer, Apple’s CFO, in a statement. “We continue to generate cash in excess of our needs to operate the business, invest in our future, and maintain flexibility to take advantage of strategic opportunities.”
MacDailyNews Take: YKBAID.
Borrowing to pay div and fund buy back is actually a brilliant move. You are effectively borrowing money for free while retaining your cash and thus not paying tax in repatriation. Additionally the cash flow from operations is such that Apple could continue to add to cash position despite borrowing. This is inefficient for the same reason borrowing is a smart make this a rare environment where this strategy works. A 5 yr note would probably yield less than 2 % and sell out in hours.
You make no sense whatsoever.
Cash is never loaned for free. If Apple has such strong cash flow that it wants to add to its hoard (which is a poor move given today’s poor investment horizon), it should placate Wall Street using its free cash flow. With rare exception, a mature company with strong cash flow going into debt is STUPID.
what the hell happened to the stock price it went sky rocketing up up upppp and now its down 0.3% after hours???
• Cook: We can’t control share price and we continue to focus on long-term and on making the best products and services; things we can control
• Cook: The decline in AAPL share price has been “VERY FRUSTRATING TO ALL OF US.”
• Cook: iPad mini strategically priced with lower margins
• Cook: We acknowledge that our growth has slowed and or margins have decreased
That a boy cooky….right after this the shares lose all their after hours gains…
Noticed that too, AAPL was up roughly 6% before TC said that, now it’s down 0.2%.
Shove this down on the iHaters throats and tell them to bend over. They just got their butts kicked big time. The stock manipulators needs to be investigated and go to jail. They have manipulated the stocks long enough…
Considering a lot of folks are bringing hundreds of dollars a month less do to payrol tax increases this quarter (understand they restored taxes to previous levels) but non the less, people have considerable less spending money that could of made the difference of having a phone or not so I can understand why people are not spending as much and growth is slower. May Apple continues to make great products!
But… has Apple any ability to use its cash to create new products and solutions?
– What comes after iPhone and iPad? The only way for Apple to survive is to bring one more great product. If it isn’t InterestMachine™ and MIST-UI™ and its BlinkUI™ it may be Marissa and Yahoo-Sony-Oracle, all quicker than Apple? [Google: “What comes after iPhone Bolzano”]