Apple Reports Third Quarter Results; Shares Fall Despite Rise In Profits

Earlier this week, Apple Inc. released its financial results for the third fiscal quarter of 2015. The sophisticated device maker reported that it sold approximately 47.5 million iPhones, 10.9 million iPads and 4.8 million Macs in the past three months. International sales accounted for 64 percent of the quarter’s revenue, confirmed Apple.

According to the reports released, they posted revenue of AU$67.23 billion with a quarterly net profit of AU$14.50 billion or AU$2.51 per share whereas last year it had recorded revenue of AU$50.69 billion and net profit of AU$10.44 billion. Meanwhile, the gross margin for the reported quarter improved about 0.3 percent compared to same period in 2014. Overwhelmed by the profit records, the company has announced to pay dividend of AU$0.71 per share to its shareholders on August 13, 2015.

Apple CEO Tim Cook said, “ We had an amazing quarter, with iPhone revenue up 59 percent over last year, strong sales of Mac, all-time record revenue from services, driven by the App Store, and a great start for Apple Watch.” He said the new Apple Music has been received acclamation from the entire nation which he described as “incredible” and confirmed the release of iOS9, watch OS2 and OS X EI Capitan in the coming fall. However, analysts say that sales of Apple watch were not as good as expected.

Nonetheless, the record of the quarter revenue has been extra-ordinary for Apple. As has been the case in the past, sales declined to 10.9 million units from 13.3 million in the previous year’s quarter with only iPad sales soaring high.

Apple provided the following guidance for its fourth quarter this year:

• Revenue between AU$ 66.45 billion and AU$ 69.16 billion
• Gross margin between 38.5 percent and 39.5 percent
• Operating expenses between AU$ 7.93 billion and AU$ 8.07 billion
• Other income/(expense) of AU$ 542.41 million
• Tax rate of 26.3 percent

Despite, turmoil in the Chinese stock market, Apple remained confident about its sales in China because last year the revenue record was more than double. Luca Maestri, Apple’s chief financial officer said that China sales in the period of three months exceeded those in the United States whereas near the end of June, the US had higher results. Bloomberg reported that the revenue in China rose to AU$ 17.90 billion from AU$8.45 billion in the fiscal third quarter compared to last year.

Coming on to the shares, inspite of high profit records, the investors didn’t seem to be happy with the results. It has been reported that shares closed 4.3% lower at AU$169.52 last night. According to the analysts, the shares plummeted seeing the company’s fourth quarter forecasts as investors expected more returns and a major share of the profit solely attributed to iPhone sales, reported BBC.

Meanwhile, Mr. Cook stated that he has been expecting China to become its largest market and declared that the company has been planning to open up several other retails store in the country by next year.

Contact the writer on priya.shayani@gmail.com