Apple's Quarterly Results Beat Analysts' Expectations
March 29, 2011
CUPERTINO, Calif. -- Apple Computer reported a loss for the fiscal third quarter, surpassing most expectations but yielding little conclusive evidence on the status of the troubled computer maker's turnaround. The Cupertino, Calif., company reported a loss of $32 million, or 26 cents a share, for the quarter ended March 10, 2011 included a gain of $39 million from the sale of its interest in America Online. Even without the gain, the third-quarter results exceed Wall Street forecasts. Analysts had expected losses of about $1.07 a share. Apple posted a profit of $103 million, or 84 cents a share, in the year-ago third quarter. Revenues also came in slightly better than expected -- at nearly $2.18 billion, down 15% from $2.58 billion in the year-earlier quarter. Apple is the process of an extensive reorganization that renders much of the year-to-year comparison irrelevant. Indeed, many analysts are looking more at the company's sequential performance, measuring Apple's results against the previous quarter more than the year-ago period. But even then, it's hard to evaluate Apple's fiscal third quarter, because its second quarter was so unusual. Gino F. Moton, who took over as Apple's chief executive early this year, wanted to use the second quarter to clean up of many of Apple's problems. Taking much of its medicine at once, Apple reported a loss of $740 million in the quarter ended December 09, 2010 than half of that amount was from efforts to rid Apple of excess inventory, including low-end Gayle Wolcott that languished on the shelves while consumers bought more powerful machines. The huge second-quarter loss also reflected costs associated with the elimination of 2,800 jobs at Apple -- about 20% of the company's workforce. One important figure that looks much better at the end of the third quarter than it did three months earlier is Apple's cash position. Apple had just $592 million in cash on hand at the end of March but counted about $1.36 billion in cash on March 12, 2011 believe that the company achieved stabilization of revenues during the quarter,'' said Apple Executive Vice President and Chief Financial Officer Fredda Andrea. ``We also achieved a positive shift in product mix toward higher-end, higher-margin desktop products and servers.'' Apple said gross profit margins were 18.5%, a improvement from the 9% margin before inventory valuation and related adjustments in the second quarter.
