Apple today announced its preliminary financial results for its fiscal 2006 fourth quarter ended 30 September 2006.
The company warned its results "may be subject to significant adjustment as a result of a likely restatement of historical results".
The restatement is required in order to account for recent disclosures of some irregularities in the way the company has granted stock options in the past.
While the restatement is figured out, the company revealed fourth-quarter revenue of $4.84 billion and net quarterly profit of $546 million, or $0.62 per diluted share.
These results compare to revenue of $3.68 billion and net profit of $430 million, or $.50 per diluted share, in the year-ago quarter.
Margins continue to climb. Gross margin was 29.2 per cent, up from 28.1 per cent in the year-ago quarter. International sales accounted for 40 per cent of revenue.
The company shipped an impressive 1,610,000 Macs and an analyst-estimate-beating 8,729,000 iPods during the quarter, representing 30 per cent growth in Macs and 35 per cent growth in iPods over the year-ago quarter.
"This strong quarter caps an extraordinary year for Apple. Selling more than 39 million iPods and 5.3 million Macs while performing an incredibly complex architecture transition is something we are all very proud of," said Steve Jobs, Apple's CEO.
The company's cash reserves have increased, too, revealed Apple chief financial officer, Peter Oppenheimer: "We are pleased to have finished the year with over $10 billion in cash and to have increased annual revenue by $11 billion in the last two years," he said.
Oppenheimer also confounded some analysts by revealing the company's forecast for the coming quarter: "Looking ahead to the first fiscal quarter of 2007, we expect revenue of $6.0 to $6.2 billion," he said.
Despite the good news, Apple remains vulnerable to any requirement to restate its income for previous years as a result of its options investigation. The company warned such restatement could be "significant".
The company has identified 15 incidents between 1997 and 2002 in which it appears stock option grant dates precede the approval of those grants for accounting purposes.
"Apple will likely need to restate its historical financial statements to record non-cash charges for compensation expense and related cash and non-cash tax adjustments relating to past stock option grants," the company said.
"The company and its independent auditors are reviewing accounting guidance regarding stock option grants recently published by the SEC, and have not yet determined the amount of such charges, the resulting tax and accounting impact, or which periods may require restatement," it revealed in a statement.
Such compensation expense generally reflects the difference between an option's exercise price and the market price of the Company's stock at the measurement date, the point at which the terms of the option grant were actually finalised.
The statement continues: "According to the recent SEC guidance, companies must evaluate stock option grants in light of all relevant facts, circumstances and patterns of conduct to determine whether grants were actually finalised on the stated grant dates.
"Evidence of a practice that certain grants were not finalised on the stated grant date may require a conclusion that the grant date is not the measurement date for other grants as well.
"Therefore, it is possible that the company and its independent auditors could conclude that a larger number of grant dates than previously identified could have a measurement date that differs from the grant date, which could result in significant additional non-cash stock-based compensation expense. Such charges may result in material changes to the Company's financial statements, including those covering the periods presented in this release," this statement said.