Apple's CEO has hinted its forthcoming iPad mini could be dogged by supply problems, as the manufacturer reported record iPhone sales for its September quarter.
The manufacturer reported its fourth quarter results late last night with the company posting its first full year decline in net profit for 11 years. Fourth quarter profit dropped from $8.22bn to $7.51bn, although sales increased 4.1% to $37.47bn. The company's iPhone sales were 33.8m, a record for the quarter and up 26% on a year ago. Its iPad sales were marginally up by 100,000 units to 14.1 million.
Profits declined at Apple for the third consecutive quarter as it brought lower cost devices to market like the iPad mini and continued to push on earlier iterations of the iPhone. In a conference call with analysts, CEO Tim Cook described the iPhone 4s as its 'entry level' device, with the recently released 5c as its mid-tier handset.
Cook said the manufacturer continues to have a 'significant' backlog of orders for the iPhone 5s to satisfy. UK operators were left angry at stock shortages of the most recent flagship device when it went on sale last month. He said: 'Our supply is building each week and we’re -- we’ve been -- and we’re very confident of our ability to keep ramping and so we rolled out 30 more countries with the iPhone 5s and 5c as of last Friday and we'll roll out another 16 this week. And so we're right on where we would like to be in terms of achieving 100 countries by the end of the calendar year.'
Apple unveiled its iPad mini with Retina display last week, with the device expected to go on sale next month. However, Cook hinted that it could also face some constrained supply in the first weeks of sale. He said: 'It's unclear whether we will have enough for the quarter or not. We now have mini – we will have but you really don't know the demand until after you start shipping and so we'll see how that goes.'
Investors have become increasingly jittery about the long term financial performance of Apple. Its share price briefly declined after the results were released last night although it recovered in after hours trading. However, Apple's stock price is 13% below what it was trading at a year ago.
Author: Graeme Neill