Amongst rampant speculation that Apple’s second quarter results where going to be less than stellar, the Cupertino, Calif.-based computing pioneer 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 per cent compared to 47.4 per cent in the year-ago quarter. International sales accounted for 66 per cent of the quarter’s revenue.
Apple continued to sell a lot of iPhones in Q2 about 37.4 million in the quarter, compared to 35.1 million in the year-ago quarter. Apple also sold 19.5 million iPads during the quarter as well, compared to 11.8 million in the year-ago quarter. The company sold fewer than four million Macs, compared to four million in the year-ago quarter for flat results.
Company CEO Tim Cook said he was pleased to report record March quarter revenue thanks to continued strong performance of iPhone and iPad. “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,” Cook said.
Canaccord Genuity financial analyst Michael Walkley said after the Apple results were released that the numbers were consistent with what was expected. However, he added, Apple’s projected revenue for the current quarter “failed to meet even our below-consensus estimates, as refreshes of key iPhone and iPad products are not expected to occur until the fall.”
Still, he said, “we maintain our belief that Apple is well positioned to leverage its leading iOS ecosystem and large installed base, and new product launches expected in 2H/C2013 should result in reaccelerating year over year earnings growth during the September quarter.”
Cook did the expected today and more than doubled capital returns to shareholders totaling about $100 billion by the end of 2015.
This move represents about a $55 billion increase to the program announced by Cook last year and it translates to an average rate of $30 billion per year from the time of the first dividend payment in August 2012 through December 2015.
According to Apple, the program increases 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.
In addition, Apple’s board approved a 15 per cent 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. With this increase Apple is now among the largest dividend payers in the world, with annual payments of about $11 billion.
Cook added that Apple is very fortunate to be in a position to more than double the size of the capital return program and believes strongly that repurchasing shares represents an attractive use of capital.