Apple posts better-than-expected quarterly results

Apple has reported better-than-expected financial results for the quarter ended 27 September 2014

Apple has reported better-than-expected financial results for the quarter ended 27 September 2014, with revenue of $42.1bn and net profit of $8.5bn.

Revenue was $2.1bn more than predicted by analysts, up by more than 12% compared with the same period a year ago, while profit rose by more than 13% on 2013, driven largely by strong sales of the iPhone, which accounted for 56% of the quarterly revenue.

Apple’s share price rose by more than 1% to just over $100 in after-hours trading in response to the strong results.

“Our fiscal 2014 was one for the record books, including the biggest iPhone launch ever with iPhone 6 and iPhone 6 Plus,” said Tim Cook, Apple’s chief executive.

“With amazing innovations in our new iPhones, iPads and Macs, as well as iOS 8 and OS X Yosemite, we are heading into the holidays with Apple’s strongest product line-up ever.

"We are also incredibly excited about Apple Watch (pictured) and other great products and services in the pipeline for 2015,” he said.

Apple announced the iPhone 6, iPhone 6 Plus and Apple Watch in September.

The iPhones were on sale for just 10 days during the quarter, but Apple sold more than 10 million in the first three days alone, making it the fastest-selling iPhone to date.

In total, Apple said it sold 39.3 million iPhones during the quarter, an 11.6% increase on the same period in 2013.

Mac sales also contributed to the strong results, jumping 25% year-over-year to 5.5 million.

However, iPad sales declined for the third quarter in a row, falling by more than 7% to 12.3 million.

"Our strong business performance drove EPS [earnings per share] growth of 20% and a record $13.3bn in cash flow from operations in the September quarter," said Apple’s chief financial officer, Luca Maestri.

"We continued to execute aggressively against our capital return programme, spending over $20bn in the quarter and bringing cumulative returns to $94bn,” he said.

Apple also posted a positive outlook for the next quarter, with revenue expected to be between $63.5bn and $66.5bn. 

Apple’s results were announced after the company’s mobile payments system, Apple Pay, went live in the US and the release of an update to Apple’s latest mobile operating system, iOS 8.1.

Apple Pay is expected to compete with PayPal and other online payment systems. Although Apple said it will not charge retailers or consumers for using its pay system, it has not divulged any details of the financial arrangements agreed with banks.

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