Apple profit remains low as the last fiscal quarter data of the company displayed a drop of 18% according to CNN. The gross profit margin of the gadget manufacturer also declined by 10 points added the report.
Despite the decline of the Apple profit margin based on a year-on-year quarter comparison, the tech giant definitely surprised the analysts in Wall Street because it was actually stronger in comparison to their forecasts. It should be noted though that the figures are still below the promised target of the Cupertino-based company for the previous quarter.
The Apple profit for the second fiscal quarter, which covered up to March 30, amounted to $9.5 billion based on their $43.6 billion sales according on the news published by Yahoo! Finance. The net profit figures were lower than the $11.6 billion of the same quarter last year but it is stronger than the $39.2 billion revenue of the same period.
iPhone sales were listed to be at 37.4 million, which is higher than the same quarter of last year with only 35.1 million. On the other hand, iPad sales came in at 19.5 million, which is more than the 11.8 million record of the second fiscal quarter of last year. However, the Mac sales remained stale with 4 million.
Statement of Apple
Tim Cook, the CEO of Apple, attributed the improved sales to the strong performance of their flagship products namely, the iPad and iPhone. He added that his company will continue working hard on developing their products and services plus in coming up with more innovations, said CNET.
Although it was clear that the year-on-year quarter comparison of Apple profit showed an 18% decline, in what seemed to be a first of its kind in a decade, Cook justified that the figures in the same fiscal quarter of 2012 were so strong making it hard to compare it with the previously listed results.
Cook further stated that there are variables that have to be considered as well in comparing the last quarter to its counterpart in the last year data. The variables mentioned were higher gross profit margins, a stronger value of the dollar and component costs that were lower.
Other Factors that Contributed to the Drop
CNN explained one of the reasons why Apple profit plummeted this quarter in spite of the rise in sales. The news source said that it could be attributed to the fact that many customers are now opting to buy older iPhone models and are switching to the more affordable iPad Mini. These devices are considered to be less profitable for the company as compared to their new releases.
Target for Next Quarter
In the same report by Yahoo!, Apple is aiming to get a revenue of $33.5 billion up to $35.5 billion in the following fiscal quarter. The gross margin is targeted between 36% to 37%. Then, the company is looking to spend between $3.85 up to $3.95 in terms of operating expenses and it will set aside $300 million for other expenditures. The tax rate for the period is expected to be at 26%.