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Announcing sales records, Jobs vows Apple 'will triumph' over Android

Apple CEO joins earnings call as iPhone, Mac set sales records in monster quarter for the company

October 18, 2010 08:00 PM ET

Computerworld - Apple announced on Monday that it once again had set a Mac sales record last quarter, and also broke previous records for both the iPhone and iPad.

CEO Steve Jobs, who rarely participates in earnings announcements, joined the conference call with Wall Street analysts to boast that Apple's iPhone had passed Research in Motion's BlackBerry, and to maintain that he was "confident we will triumph" over rivals running Google's Android operating system.

Overall, the company posted record revenues of $20.3 billion for the quarter -- the first time Apple has passed the $20 billion mark -- an increase of 61% over the same period last year. Profits were $4.3 billion, up 70% from the same quarter in 2009.

"Spectacular," said Ezra Gottheil, an analyst with Technology Business Research.

"Every quarter seems to be a record with them," added Brian Marshall of Gleacher & Co.

In the quarter that closed Sept. 30, Apple sold 3.9 million Macs, breaking last quarter's then-record of 3.5 million machines. Mac unit sales were up 12% over 2010's second quarter and 27% over the same quarter in 2009.

Apple has set Mac sales records in four of the last five quarters.

Apple sold 14.1 million iPhones, up 98% over the same period last year, not only a record but also the first time the company sold more than 10 million iPhones in a single quarter.

It was also the first time Apple sold more iPhones than it did its less expensive iPods. iPhone revenues were about six times that of the iPod's, Apple said. The iPhone accounted for 43% of the company's total revenues for the quarter.

But the iPhone sales number could have been even larger.

"We would have been able to sell more iPhones if we had had them," said Peter Oppenheimer, Apple's chief financial officer. Apple currently has 3.3 million iPhones in inventory, enough for less than a month's sales at last quarter's pace.

Oppenheimer said that Apple wrote off $100 million to cover the costs of its free case program, which it launched in July (and shut down in September) to quell complaints from customers over dropped calls when they held the iPhone 4 in certain ways.

The iPad's second quarter of sales hit Apple's balance sheet with 4.2 million units sold, a 28% jump from the prior period.

"We have a tiger by the tail," said Jobs of the iPad.

Last quarter was also the first time that Apple sold more iPads than it sold Macs, something Jobs was quick to mention.

"iPad will clearly affect notebook computer [sales]," said Jobs, echoing industry analysts who have said that the popular tablet has cannibalized sales of both notebooks and smaller, cheaper netbooks. "I think the iPad proves that [the tablet] is not a question of if, but of when," Jobs added.



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