iPhone Helps Apple Profit Rise 47 Percent; Stock Leaps

By Dena Cassella October 19, 2009

Apple Inc. said its net income rose 47 percent in the most recent quarter as more people bought Mac computers and gave in to the iPhone craze. The results, released Monday, sent Apple shares surging 7 percent in extended trading to an all-time high.

Apple unveiled a faster iPhone in June and cut the price of the previous generation of the phone to $99. That boosted iPhone sales from July through September to 7.4 million devices, half a million more than last year.

Apple weathered the economic meltdown better than other computer companies, giving it a running start when PC sales grew in the quarter. Apple had also updated its Mac operating system and refreshed its Macbook Pro line. Apple sold 3.1 million Macs, a 19 percent rise from the same period a year ago.

As Apple’s iPhone, which has iPod features built in, has grown in popularity, Apple’s regular iPod music player business has suffered. The company sold 10.2 million iPods in the quarter, 8 percent fewer than last year, even though Apple unveiled a new iPod Nano with a video camera in September.

The iPod Touch was the bright spot in the media player lineup. Sales for the gadget, which is like an iPhone without the phone, doubled from a year ago, Apple Chief Financial Officer Peter Oppenheimer said in an interview.

Apple said it earned $1.82 per share in its fiscal fourth quarter. Sales jumped 25 percent to $9.9 billion.

Apple said its outlook for the current quarter would be well below what analysts are expecting, but the company traditionally gives extremely conservative guidance. Wall Street shrugged off the estimate and sent the company’s shares up $13.38, or 7.1 percent, to $203.24 in extended trading. The shares had closed regular trading at $189.86, up 1 percent on the day.

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