Apple in form, blows Street targets away

SAN FRANCISCO, USA: Apple Inc's quarterly results blew past Wall Street's expectations after U.S. consumers snapped up near-unprecedented numbers of iPhones and iPads, sending its shares up 8 per cent into record territory.

The world's most valuable technology corporation returned to form after a rare miss in the previous quarter, assuaging investors' worries that its sheer size meant it was headed into a period of slower growth.

It sold 37.04 million iPhones - its flagship product - and 15.43 million iPad tablets, doubling from a year earlier and easily outpacing already heightened expectations for a strong holiday season. That helped swell its warchest of cash and securities to almost $100 billion - more than enough to plug December's U.S. budget deficit and level with California's 2012/13 spending plan.

The company founded by late Silicon Valley titan Steve Jobs - who died in October after a years-long battle with cancer - smashed estimates on all its results including gross argin, which came in at 44.7 per cent during the quarter.

Apple reported a net profit of $13.06 billion, or $13.87 a share, handily outstripping an average Street forecast of $10.16 per share. The beat alone - by more than $3 a share, or $3.5 billion - would be a respectable sales figure for many smaller tech companies.

"Going into 2012, I expect strength of iPhone, iPod Touch and iPad should carry on into the year. Apple still has some tailwind, including opening up new retail stores and expanding its distribution channels," said Hendi Susanto at Gabelli & Co.

"I would say Apple still has many unpenetrated international markets ... Apple is still far from its saturation."

The results allayed lingering doubts about the ability of new Chief Executive Tim Cook to lead the company that Jobs built from a garage project into a global leader. This was the first full quarter for Apple without its legendary co-founder.

Apple's revenue leapt 73 percent to $46.33 billion, handily beating the average Wall Street analyst estimate of $38.91 billion, according to Thomson Reuters I/B/E/S.

Shares in Apple jumped 8 percent to about $452 in extended trade following the earnings report. The stock - which set a record high of $427.75 just this month - had closed at $420.41 on the Nasdaq.

Several analysts had warned that Apple might face a rougher ride than usual in 2012.

Google Inc's Android - a free software to run smartphones, adopted heavily by Samsung Electronics, Motorola and others - is chipping away at Apple's market share. A host of tablets from Amazon.com Inc, among others, offers buyers viable alternatives.

And then there are the inherent difficulties in maintaining growth momentum. In fiscal 2011, Apple tacked on $43 billion to its revenue, which analysts likened to birthing a Fortune 500 from scratch - every year. Its market value stood just shy of $400 billion, rivaling Exxon Mobil for the title of largest U.S. corporation.