Apple Soars During Economic Gloom

The new Apple iPod Shuffle is shown at an Apple store in Palo Alto, Calif., Thursday, March 12, 2009. Apple Inc. unveiled a minuscule new iPod Shuffle that takes its "smaller is better" mantra to a whole new level. The third-generation Shuffle, a slim aluminum rectangle less than 2 inches long, takes up about half as much space as the previous version even as it doubles music storage space to 4 gigabytes holds about 1,000 songs. (AP Photo/Paul Sakuma)
AP Photo/Paul Sakuma
Apple blew away expectations for its second fiscal quarter, reporting revenue and net income far beyond what the Wall Street community was expecting amid a poor economy.

For the period ended March 28, Apple recorded $8.16 billion in revenue, up from $7.5 billion in revenue during the same period last year. Net profit was $1.21 billion, or earnings per share of $1.33. Analysts had been expecting revenue of $7.96 billion and earnings per share of $1.09.

Apple sold 2.22 million Macs, 11 million iPods, and 3.79 million iPhones during the quarter, meeting or exceeding expectations from financial analysts. CFO Peter Oppenheimer called it "the best non-holiday quarter revenue and earnings in our history," in a press release announcing the results.

As usual, Oppenheimer provided third-quarter guidance below what analysts were seeking. The consensus Wall Street estimate for Apple's June quarter was $8.28 billion in revenue and earnings per share of $1.12, while Oppenheimer said Apple expects to record between $7.7 billion and $7.9 billion in revenue and earnings per share between $0.95 and $1.00 during the current quarter.

Mac shipments fell 3 percent compared to last year. It's the first time Mac shipments have fallen year-over-year, but some had expected worse. Desktop shipments fell 4 percent, and portable shipments fell 2 percent, but revenue was way off: 22 percent in desktops, and 12 percent in portables. Still, as with last quarter, international Mac sales were stronger than U.S. Mac sales.

The iPod lineup appeared to get a clear boost from the launch of the new iPod Shuffle, with Apple selling about 1 million more iPods than analysts had expected. iPod shipments were up 3 percent compared to last year as revenue fell 16 percent, suggesting that sales of the $79 iPod Shuffle made up a greater amount of Apple's iPod mix than usual.

And as had been foreshadowed earlier on Tuesday, Apple sold 3.79 million iPhones, which Piper Jaffray's Gene Munster predicted based off of AT&T's activation numbers for the quarter. iPhone shipments were up sharply compared to last year, but fell coming off the holiday quarter.

By Tom Krazit