Apple stock gains 8% after earnings beat Wall Street
24 Apr 2014
Apple delighted investors yesterday reporting better-than-expected earnings, strong iPhone sales, an increase in the company's dividend, an additional $30 billion for its stock repurchase programme, the first stock split in nearly a decade and new products in the pipeline.
Apple's stock gained nearly 8 per cent after the announcement of results.
San Jose Mercury News quoted Andy Hargreaves, a financial analyst covering Apple for Pacific Crest Securities as saying "it was a great quarter". He added that by allotting more money for dividends and stock repurchases, Apple's executives were "certainly trying to show confidence in the business, and that's great."
The results come after a series of dismal earnings reports as sales slowed and profit growth fell. There were widespread worries that the latest quarter would also follow the same pattern, and investors worried that the company had lost its innovative edge.
According to the Cupertino, California-based company, it earned $10.2 billion, or $11.62 a share, in the period ended 29 March, which was up from $9.5 billion, or $10.09 a share, in the same quarter a year earlier. Apple's sales increased 4.6 per cent from its second quarter of 2013 to $45.6 billion.
The results followed blockbuster iPhone sales, with the company selling 43.7 million units, a record number for its fiscal second quarter. The figure was up 17 per cent from the same period last year.
Gross margin worked out to 39.3 per cent as against 37.5 per cent in the year-ago quarter.
The quarter's revenue was accounted 66 per cent by international sales.
''We're very proud of our quarterly results, especially our strong iPhone sales and record revenue from services,'' Apple's CEO Tim Cook said in a statement.
According to Peter Oppenheimer, Apple's CFO, the company was eagerly looking forward to introducing more new products and services that only Apple could bring to market.
He said, Apple had generated $13.5 billion in cash flow from operations and returned almost $21 billion in cash to shareholders through dividends and share repurchases during the March quarter.
He added, that brought cumulative payments under its capital return programme to $66 billion.
