Apple has maintained profitability for a second consecutive quarter -of the year. exceeding Wall Street's expectations - but said it does not expect a return to growth until the end of this year.
For its second fiscal quarter, ended 27 March, the manufacturer announced a $55 million profit, up from a loss of $178 million a year ago, on revenues of $1.4 million and $1.6 million respectively. There was an eight per cent year-on-year growth in unit sales, and an improvement of gross margins to 25 per cent.
According to Apple chief financial officer Fred Anderson, unit sales improved in all geographical areas except Asia, which saw a 28 per cent decline. Inventory levels in Europe were reduced to five weeks, and in the US to six weeks. Anderson attributed the improved gross margins to higher margins on the company's G3 products, as well as improved cost control.
But Anderson admitted he did not see Apple returning to growth in this fiscal year. He said revenue would be 'relatively flat, sequentially' for the next few quarters, with a return to growth in the December quarter.
The manufacturer's financial performance has been driven by downsizing, with 117 staff due to leave within the next few days.
Apple hopes to return to growth with an updated line of low-priced consumer products, to be released in the last quarter of this year. The vendor has failed to address the sub-$1,000 computer market. Online sales accounted for 'one to two per cent' of total sales.
Before the earnings were announced, Apple's share price closed up 50cent to $27.44, on expectations of strong profits.
CEO Graeme Watt admits the trading climate is becoming a little more uncertain as he and CFO Graham Charlton reflect on the reseller's £1bn year
As the trade war between the US and China ramps up, Marian McHugh investigates what impact this will have on UK prices and how partners are adapting to higher costs
CRN quizzes Avaya CEO Jim Chirico on the firm's progress after exiting Chapter 11 earlier this year, and listing on the stock exchange
Stampede becomes Exertis Pro AV Solutions