Apple Inc reported results that blew past Wall Street's expectations, boosted by robust sales of Mac computers, sending its shares 3 percent higher.
Apple's stellar financial performance in the June quarter helped ease investor fears, and may silence a chorus of critics who have been hammering the company over its handling of the iPhone 4 Antennagate controversy revolving around complaints about signal loss on the new gadget.
ASHOK KUMAR, ANALYST WITH RODMAN AND RENSHAW:
These were blowout numbers. The iPhone 4 units came in weaker than expected primarily due to the product launch, with supply constraints. But on all other measures, the company significantly exceeded guidance.
If you put it in perspective, the original iPod took 7 quarters to ship a million units. With the initial iPhone, it took only 70 days to reach the 1 million unit rate.
For iPad, it reached the one mln mark in under 30 days, and the iPhone 4 shipped 1.7 million units in the first three days.
The iPhone 4 has been in a class by itself in terms of volume. Looking ahead with multiple carrier agreements, the story remains intact. The primary driver will be the iPhone.
BRIAN MARSHALL, ANALYST, GLEACHER & CO
We saw blowout results, with upsides driven by the iPhone and the Mac, and that really negates the bears that were talking about the iPad cannibalizing the Mac and iPhone sales.
It just shows the bears that Apple's business model is alive and well.
The solid quarter, coupled with a very aggressive guidance for the next quarter is a very positive report for investors.
The Antennagate problem, that's gonna go away very quickly. I don't think it'll have a lasting effect.
BILL KREHER, ANALYST, EDWARD JONES
Early demand for the iPad has been tremendous... We expect it to be one of the most sought after gift items as we go into the holiday season.
As (iPhone antenna) media tension wanes, investors will start to focus more on long-term earnings power. We'd like to believe that (PR woes) are largely behind.
IPhone sales were great considering whispers regarding potential supply shortages. An 8.4 million number is impressive from our perspective.
I think that basically the strong numbers underscore our belief that Apple's earnings power is consistently underestimated.
COLIN GILLIS, ANALYST, BGC PARTNERS:
I had a whole big knot in my stomach about Apple and wow, they're just unbeatable. As good as the quarter was, the guidance was beyond robust. I thought it was going to take a monster quarter to accelerate shares, and we got it.
It was actually a Mac quarter. I'd say the iPhone and iPad are creating a positive virtuous spiral. They are exposing the broader consumer market to Apple's deskstops and laptops. It's very positive.
TONY BERKMAN, CHIEF EXECUTIVE OFFICER, MAJESTIC RESEARCH
Everything seems to be going really well for Apple, the fact that CPUs are growing strong reinforces the notion that they can grow their MacBook while having hypergrowth with their iPads.
We saw a little bit of cannibalization from the iPod Touch, but Apple seems to be fine with that.
15.7 will be a very well received number by the investment community, nobody pays attention to guidance with Apple any more because it's always comically low.
Based off of what institutional investors are expecting, this is a very strong number.
We might see a minor rally off these numbers, but Apple doesn't have as much of a halo effect on other companies like Intel does.
YAIR REINER, ANALYST, OPPENHEIMER & CO ANALYST:
These are astounding numbers and even more astounding guidance. This is one of the few times in recent memory that Apple's guidance has been ahead of the Street -- at a time when investors were getting concerned the iPhone 4 antenna issues could hamper sales. Apple's sending a strong signal it sees things differently.
SHANNON CROSS, ANALYST, CROSS RESEARCH
Really solid quarter. IPhone and Macs are where the upside came from during the quarter. Gross margin was solid, 39 percent, which was 300 basis points above their guidance.
They said there's more amazing new products still to come so clearly there's strength in innovation and should provide confidence for investors.
It doesn't seem like there's any holes in the earnings this quarter. Even in light of the euro worries, they were still able to exceed expectations.
I think what it shows is that even in a slowing economy consumers are willing to save and buy quality products.
(Reporting by Carolina Madrid, Sue Zeidler and Matthew Lynley, editing by Peter Henderson)