Apple takes a bite out of the competition with record profits

The company saw huge rises in sales in the run-up to Christmas. But can it keep going without Steve Jobs?

by Emma Haslett
Last Updated: 01 Apr 2011
We've always expected a lot from Apple, but this is just ridiculous. The electronics has just posted pre-Christmas sales figures that broke records almost across the board, with a $6bn (£3.7bn) profit, up 71% on the previous year; a 78% jump in revenues to $26.7bn, and an enormous rise in sales. CEO Steve Jobs wasn't over-stating it when he called the performance 'phenomenal' - but given his latest health issues, can the company carry on in the same vein?

Apple sold 4.13m Macs in the three months to Christmas day, 23% more than the year before; and managed to shif 16.24m iPhones (86% up on 2009) and 7.33m iPads - all of which broke records. The only slight spanner in the works was iPod sales, which dropped by 7% to 19.45m, but we doubt there were many tears shed over that - particularly given chief operating officer Tim Cook pointed out that the company could have sold even more iPhones during the quarter, had it been able to produce enough devices to keep up with demand.  

The impressive results might have pushed share prices up slightly, but they're overshadowed by an email to staff from Jobs on Monday, which said he's taking more sick leave, handing the reins to Cook during his absence. It doesn't look good: back in 2008, Jobs to six months' leave from the company for a series of treatments for pancreatic cancer. Monday's announcement left a lot to the imagination, with no mention of why or, indeed, how long he's planning to take off, and has led to much specualtion that his pancreatic cancer may have returned. As it's a particluarly aggressive type, that would be very bad news both for Jobs and his company.

The announcement wiped 6% off the company's share price when markets reopened after a US national holiday on Monday, and they closed down 2.2%, but analysts have pointed out it might not be the disaster some are anticipating. Apparently, Jobs' past absences have meant investors have got used to his not being around, allowing them to 'partly discount his departure into the price of their shares', according to Yair Reiner, a stock analyst at Oppenheimer & Co. Which despite sounding morbid could be good for Apple in the long run.

So all eyes are now on Cook. It's going to be a tough gig for him, particularly given the level of slavish devotion many Apple fans have for Jobs - although it probably bodes well that he has Jobs' full support. But even if does ends up with Jobs taking a permanent back seat, he's already meticulously planned Apple's product line-up for the next few years, so at least Cook will have that time to get the feel for his new job.

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