Apple surpasses expectations to send shares up by 4.7pc
APPLE'S third-quarter results beat expectations yesterday, spurring optimism that the company will weather competition from budget smartphones.
Sales at the tech giant, which employs 4,000 people in Ireland, were $35.3bn (€26.7bn), topping analyst estimates of $35bn. Profits still took a hit, sliding 22pc to $6.9bn in the three months ending June 29 as margins came under pressure from the wider array of cheaper devices flooding the market from the likes of Samsung.
The company sold 31.2 million iPhones during the period, its best-selling and most profitable product. The result was well in excess of analyst expectations, which forecast sales of about 26.1 million on average. It will bolster shareholder hopes that the company can withstand the growing low-end competition that has threatened to drag it into a prolonged slump.
Though it earns margins of 50pc or more on the iPhone 5, almost twice the level of rival models, investor concerns that Apple was losing that edge contributed to a 31pc stock decline over the past year. While it pioneered the market for touch-screen smartphones in 2007, Google's Android platform has now captured 70pc of global mobile operating system sales at the end of first quarter, compared with 17pc for Apple's iOS.
Earnings were $7.47 a share over the period; analysts had predicted $7.30.
In contrast to the unexpected success of the iPhone, sales of the iPad fell 14pc to 14.6m over the period.
Slowing sales of this and other devices have put pressure on Apple to push into new product categories. The firm has more than 100 employees working on a wristwatch-like device.
Shares in the company rose as much as 4.7pc to $438.88 in extended trading after the results were released.