Apple's highest revenue-earning quarter since 1999 exceeded analyst's expectations and saw strong demand across its product matrix in all territories, Apple announced last night.
Apple chief financial officer Fred Anderson reported profits of $63 million – exceeding analysts expectations. It was Apple's best quarter for four years.
The company shifted 829,000 Macs – up 12 per cent year-on-year and five per cent sequentially.
Apple CEO Steve Jobs opened 2003 predicting it would be the year of the notebook, a prediction that "came true", Anderson said. Notebook sales accounted for 48 per cent of Mac sales, he said, but strong demand existed across all products, barring the iMac, where unit sales declined 24 per cent year-on-year.
First quarter 2004 unit sales and year-on-year changes follow: 195,000 PowerBooks sales (up 93 per cent); 201,000 iBook sales (up 8 per cent); 206,000 Power Mac sales (up 30 per cent) and 227,000 iMacs and eMacs shifted (down 24 per cent). Year-on-year CPU revenues climbed 15 per cent for $1.3 billion.
In an optimistic prediction for Apple's recovery in the pro desktop market, Anderson said: "I believe Power Mac sales can be sustained at about 200,000 units per quarter – some quarters will be a bit higher, some will be a bit lower."
Anderson also admitted to the company placing money aside to cope with the well-known "faint white spot" on the display some Mac notebook customers had encountered. Apple has set funds aside to deal with this, the CFO suggested affected customers contact AppleCare.
"For any new systems being shipped, these problems have been resolved," he added.
On a global territory-by-territory basis, Apple's fortunes improved worldwide: while overall revenue rose 25 per cent from the year-earlier quarter in the Americas, global gains were more impressive. Revenues climbed 48 per cent in Europe, 13 per cent in Japan and 55 per cent in the Asia-Pacific region excluding Japan.
Apple's precious education market remained fairly stable, sales to higher education customers were up strongly year-over-year, while sales to other schools declined slightly. However, Apple recently gained market share in the UK education sector, the company revealed last week.
Investment firm Merrill Lynch & Co. opened the week with a positive report of its expectations for Apple, recommending the stock as a 'buy'. It said it is pleased with Apple's current strategy and product range.
"We think Apple has gotten its act together in focusing on core markets, building a mature management team, and most important innovating again," Merrill Lynch wrote. "People will pay more for Porsches, but they have to perform."
Apple's stock fell slightly in trading yesterday, as some investors presumably liquidised any profits they may have made on the company's stock performance so far.