Apple: Still a Cash Factory, Even If It Sells Fewer iPhones Than Expected

The behemoth made $13.1 billion last quarter.
Apple's CEO, Tim Cook made iPhones available with arms outstretched on China's massive China Mobile network on January 17 in Beijing. (Kim Kyung-Hoon / Reuters)

Apple's earnings are out. For a company that is dependent on a single product for the bulk of its revenue, there's some bad news.

But that news is only bad if you're an investor who has his or her notions of Apple's current value pegged to analysts' consensus estimates on iPhone sales. Earnings beat analysts' expectations, but just barely: $57.6 billion versus $57.5 billion. Meanwhile, 51 million iPhones sold in a single quarter is still healthy growth, and impressive given that Apple is running up against the law of large numbers as it seeks to expand its revenue from iPhone.

Just look at the graph of Apple's overall sales of iPhone and iPads; growth may be leveling off, but you don't have to fit a curve to this chart to see that it's continuing at a healthy pace.

On the back of the growth in sales of iPhones and iPads, Apple's gross margins are rising.

And revenue continues to grow at almost the same pace as iPhone sales.

It does appear that the sunset of the iPod is near.

Overall, there doesn't appear to be anything in this report that indicates that Apple is doing anything other than continuing to be a cash factory that delivers healthy growth despite the "maturation" of the market for smartphones.

And just to put things in perspective, 51 million iPhones is a huge number for a consumer gadget. It's 2.5x as many phones as the total number of extra-large Android smartphones, known as phablets, were sold in all of 2013. And it makes the sales of some game consoles look puny.

Presented by

Christopher Mims is the science and technology correspondent for Quartz. His work has appeared in Wired and Scientific American, as well as on the BBC.

How to Cook Spaghetti Squash (and Why)

Cooking for yourself is one of the surest ways to eat well. Bestselling author Mark Bittman teaches James Hamblin the recipe that everyone is Googling.

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register.

blog comments powered by Disqus

Video

How to Cook Spaghetti Squash (and Why)

Cooking for yourself is one of the surest ways to eat well.

Video

Before Tinder, a Tree

Looking for your soulmate? Write a letter to the "Bridegroom's Oak" in Germany.

Video

The Health Benefits of Going Outside

People spend too much time indoors. One solution: ecotherapy.

Video

Where High Tech Meets the 1950s

Why did Green Bank, West Virginia, ban wireless signals? For science.

Video

Yes, Quidditch Is Real

How J.K. Rowling's magical sport spread from Hogwarts to college campuses

Video

Would You Live in a Treehouse?

A treehouse can be an ideal office space, vacation rental, and way of reconnecting with your youth.

More in Technology

Just In