Apple Profit Rises 24% on iPhone 5 Sales

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The New York Times
Friday, October 26, 2012

Apple Profit Rises 24% on iPhone 5 Sales

By NICK WINGFIELD

In the last five weeks, Apple has revamped its entire product lineup with new iPods, iPhones and computers. But on Thursday it said those products would be more expensive to make, nibbling into its ample profits.

That forecast for the holiday quarter was the main blemish on an otherwise solid financial report. Apple said its fiscal fourth-quarter profit jumped 24 percent, largely because of a surge in sales of the iPhone, a product that now accounts for nearly half of the company’s sales.

The quarter ended Sept. 29 was the first to reflect sales of the iPhone 5, which was introduced Sept. 21. Apple has struggled to deliver enough of the devices to meet customer demand, making them tough to find in many retail stores. The company’s shares have fallen 9 percent since the product hit the market, in part because of investor concerns about short supply.

In a conference call with analysts, Timothy D. Cook, Apple’s chief executive, said that demand for the new iPhone was “extremely robust” and that the company had a significant number of back orders for it. He said production had picked up substantially since earlier this month.

The profit report was slightly below analysts’ expectations, and Apple’s stock was largely unchanged in after-hours trading. It fell 1.2 percent to $609.54 in regular trading.

Underscoring how drastically Apple’s business has been transformed by mobile products, revenue from the iPhone rose 56 percent to $17.13 billion, making up 48 percent of the company’s total revenue. It sold 26.9 million iPhones, 58 percent more than a year earlier.

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