Apple has posted record quarterly profits of $18bn (£11.8bn) powered by 74 million iPhone unit sales.
The results for the period ending on the 27th of December saw the brand achieve $75.6bn (£49.7bn) in revenue. The results for the same period last year were $57.6bn (£37.8bn) revenue with a net profit of $13.1bn (£8.6bn).
International sales accounted for 65% of the revenue in the quarter, with the firm making major inroads in the Chinese market.
Tim Cook, Apple’s CEO: ‘We’d like to thank our customers for an incredible quarter, which saw demand for Apple products soar to an all-time high. Our revenue grew 30 percent over last year to $74.6 billion, and the execution by our teams to achieve these results was simply phenomenal.’
Luca Maestri, Apple’s CFO, said: ‘Our exceptional results produced EPS growth of 48 percent over last year, and $33.7 billion in operating cash flow during the quarter, an all-time record. We spent over $8 billion on our capital return program, bringing total returns to investors to almost $103 billion, over $57 billion of which occurred in just the last 12 months.’
Apple's biggest rivals Samsung forecast a 37% fall in profit for the fourth quarter of 2014 in its preliminary earnings guidance.
Discussing the manurfacturers market position Loizos Heracleous, of Warwick Business School, is a Professor of Strategy said: 'Apple’s quarterly profits are the result of the company’s competitive advantages; namely great design, innovation (both incremental in terms of product improvements, as well as periodically radical when a groundbreaking product comes to market), and intense efficiency. Apple’s entry to China has been instrumental to revenue growth, and the upside potential in revenues from this market is very significant. At the same time, economies of scale and scope led to even greater efficiencies. Combined with a higher selling price for the iPhones, operating profits are up to nearly 40 per cent of revenues - unprecedented in consumer electronics.
'Even though iPad sales are falling, overall, the product portfolio of Apple is balanced in terms of stages of the product life cycle. The strategic implications of ApplePay have not been appreciated by most people. Not only is the revenue potential huge, with Apple’s offering already benefiting from the existing market penetration of its devices; margins are also very healthy and the service has synergies with the iPhone and the iWatch, helping to solidify Apple’s strategy of building and controlling a product and service ecosystem. Similarly, the iWatch will provide a further boost in growth and will buttress the ecosystem when it comes to market.
'Apple’s strategy displays related diversification. Those who argue that its success is down to a single product do not appreciate the considerable synergies across Apple’s products and services, nor the continued development and strengthening of Apple’s ecosystem.'