After two straight quarters of drooping profits, Apple is on the defensive for the first time in recent history. Today, the company reported the results of its fourth fiscal quarter. A few months ago, Tim Cook and company seemed confident about the unannounced product line stashed up the company's sleeve. But how do things look now that Cupertino has shown its hand?
The iPad Slump Eases; iPhones Charge Ahead
It's important to bear in mind that Apple's July-September quarter results only reflect 10 days worth of sales of the iPhone 5S and iPhone 5C, which hit shelves on September 20.
In the fourth fiscal quarter, Apple sold 33.8 million iPhones, up from 31.2 million in the last quarter. Sales of the iPad remain flat—no surprise, considering that this report doesn't account for Apple's recent iPad event—at 14.1 million units sold, up from 14.6 million in the last quarter. In the same quarter last year, Apple sold 14 million iPads. In the April-June quarter, iPad sales dropped 14% to 14.3 million units, down from 17 million a year earlier.
In its fiscal Q4, Apple generated $37.5 billion in revenue and a profit of $7.5 billion, a slight boost from $35.3 billion in revenue and $6.9 billion in profits respectively in Apple's 2013 Q3.
Criticism Remains With New Products In The Wild
Moving into the holiday season, Apple's products are as solid and polished as ever, but Apple's hardware strategy has faced criticism and investor backlash for its recent phase of consistent iteration rather than flashy from-scratch product innovation. Sales of the iPhone 5C have been lackluster to date, with major retailers like Best Buy slashing prices to move units within a few weeks. The iPhone 5S—particularly the elusive gold 5S—also suffered from supply constraints from launch.
Apple's new mobile operating system has suffered from plenty of bugs and bumps along the way, but iOS 7 is shaking things up way more than any of the company's hardware in 2013. Still, it's not easy to get next-big-thing-hungry consumers buzzed about something that they can't hold in their hands.
Looking Forward To Apple's Next Quarter
Given its fleet of new products at the ready for the 2013 holiday season, next quarter should be where the real action is. Apple anticipates revenue to perk up significantly to between $55 billion and $58 billion next quarter, but of course we'll need to stay tuned to see what really happens after the new iPhones and iPads have a little more time out in the wild.