Jay Taylor: For Apple Inc. (NASDAQ:AAPL) , 2015 has started with a bang. Earning a profit of $18 billion during the final three months of 2014, the latest Apple earnings report is the biggest ever from a publicly traded company.
The company’s revenue rose to $74 .6 billion from $57.6 billion in the previous year, a year-over-year increase of 29.5%. Gross margins rose to 39.9% from 37.9% over the same period, though overall margins were negatively affected by a rising dollar.
Still, Apple beat expectations across the board with only one exception – iPad. Even with a shrinking market for PCs, Apple grew its Mac sales by 9%. International sales now account for 65% of sales, overall sales in China rose by 70% and iPhone sales rose 46% compared to last year. Profit grew by 38%.
These are huge numbers.
The strong results weren’t necessarily expected. The $74.6 billion of revenue generated during the quarter is more than 10% higher than consensus estimates. Profit of $18 billion is more than 17% above consensus estimates. This was truly a blowout quarter for Apple. It’s no surprise the stock rose 5% in after-hours trading.
Apple’s cash pile has now grown to an absurd $178 billion.
This is enough to buy Delta Air Lines, United, Virgin America, JetBlue, Southwest, American, Spirit and Alaska Airlines combined AND still have enough left over to buy Harley-Davidson.
Part of what makes the $178 billion pile of cash and short-term investments so absurd is the fact that the company has already returned $57 billion to shareholders in the last 12 months.
The weak spot in the Apple earnings report continues to be iPad. Sales declined 22% compared to last year. That said, I certainly won’t be complaining as long as the earnings reports continue to look like this one.