Apple Shares Plunge Following Disappointing Financial Results
Published on: 28th Jan 2014
By: Ian Mansfield
Apple has disappointed investors after it posted flat lining profits despite higher revenues sending its shares down sharply.
Apple posted record quarterly revenue of US$57.6 billion which was up slightly on the US$54.5 billion a year ago. However profit was flat at US$13.1 bullion as profit margins shrank to 37.9 percent compared to 38.6 percent in the year-ago quarter.
International sales accounted for 63 percent of the quarter's revenue.
The Company sold 51 million iPhones, an all-time quarterly record, compared to 47.8 million in the year-ago quarter. Apple also sold 26 million iPads during the quarter, also an all-time quarterly record, compared to 22.9 million in the year-ago quarter. The Company sold 4.8 million Macs, compared to 4.1 million in the year-ago quarter.
"We are really happy with our record iPhone and iPad sales, the strong performance of our Mac products and the continued growth of iTunes, Software and Services," said Tim Cook, Apple's CEO.
However, investors were less happy with the performance, as shares in the tech giant fell close to 9% in after-hours trading. The company also lowered its sales outlook for the year ahead which has worried investors.
The one upside is that the company saw strong growth in China, where it has just released its iPhone with China Mobile after years of delays.
Sales in other parts of Asia were however hurt by currency fluctuations, particularly in Japan. There was also a sales dip in the USA as mobile networks changed their upgrade policies, which seemed to deter customers from upgrading in the short term.
"We generated $22.7 billion in cash flow from operations and returned an additional $7.7 billion in cash to shareholders through dividends and share repurchases during the December quarter, bringing cumulative payments under our capital return program to over $43 billion," added Peter Oppenheimer, Apple's CFO.