Apple's sales and profits beat Wall Street's expectations

Apple has defied the economic gloom by reporting better-than-expected quarterly results, despite a slowdown in iPhone shipments. For its fiscal 2009 first quarter (ended 27 December 2008), traditionally the company's strongest, Apple reported record revenue of US$10.17 billion and record net profit of US$1.61 billion. This compared to revenue of US$9.6 billion and net profit of US$1.58 billion in the year-ago quarter. 

Sales were driven by the Mac as Apple sold 2.5 million Macs during the quarter, a rise of 9 percent year-on-year and the iPod, which saw annual quarterly sales rise 3 percent to 22.7 million units.

Apple sold 4.4 million iPhone units in the quarter, an 88 percent rise from a year earlier, a period when the first generation iPhone was available in only a handful of markets. However, iPhone sales slumped significantly from the previous quarter, which had seen the launch of iPhone 3G and unit sales of 6.9 million. 

If Apple wants to boost iPhone sales, Apple would need to further cut iPhone 3G prices or probably come up with an iPhone Nano at $199 model as soon as possible. Apple should also consider convincing its carrier partners to offer cheaper service plans as not everyone will spend $80-$100 per month on AT&T services.