Apple doubles profits in Q1

Taking yet another juicy bite out of the global consumer electronics market, Apple has doubled its profits in the first quarter, to $11.6bn.

by Michael Northcott
Last Updated: 19 Aug 2013

As if more evidence of Apple’s continued success were needed, the consumer electronics monolith has announced that its profits doubled to $11.6bn (£7.2bn) in the first quarter of 2012, up from $6bn in the same period last year.

The company has shifted awe-inspiring numbers of its devices all around the world, including 35 million iPhones, 11.9 million iPads, and 7 million Mac computers. For the maths geeks, that’s 25,000 devices per hour, constantly, for three months straight. And that doesn’t include iPods and the host of other little extras and shiny accessories the company flogs to its evangelical customers. Sales totalled $39.2bn for the quarter. 

The increases in individual products’ sales compared with the same period last year are impressive in their own right: 88% more iPhones, 150% more iPads and 7% more Macs. With sales patterns like these, it’s no wonder this company has more than $100bn in the bank. 

Interestingly, the announcement prompted a nervous reaction from investors. The company’s share price rose 7% in after-hours trading, but actually dipped slightly this morning, symptomatic of the old adage that shareholders don't like surprises, even if they're good ones.

In addition, many investment management services are under obligation to keep portfolios within strictly controlled risk profiles, and a leap in the Apple share price can leave a portfolio over-exposed. Nonetheless, Apple remains the most valuable company in the world, with a market capitalisation of $522.39bn.

Apple’s CEO, Tim Cook, is pretty confident that the company will continue in this miracle vein. He said: ‘The new iPad is off to a great start, and across the year you’re going to see a lot more of the kind of innovation that only Apple can deliver.’ A bold statement, given that Europe is getting jittery and the UK has just been graded as ‘back in recession’ after another output contraction in Q1.

This is Apple though, and with the progress it is making in rapidly growing markets such as China, we think somehow Cook is probably right. Bring on another billion. 

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