Apple's Profit Jumps 78%

JULY 20, 2010, 5:20 P.M. ET.

Apple's Profit Jumps 78%

By JOHN KELL

Apple Inc.'s quarterly profit jumped 78%, as the company posted stout initial sales of its multimedia iPad device and the latest version of its smartphone, the iPhone 4.

A main driver of growth for the quarter was the iPhone, which sold 8.4 million units, 61% more than a year earlier. Apple also reported it sold 3.3 million iPad devices, which became available in early April.

The company said the average sales price for its iPad was $640 and the average sale price in the quarter for its iPhone was $595. Most consumers get subsidies from carriers when they purchase an iPhone.

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.Apple's profit in the June quarter rose to $3.25 billion, or $3.51 per share, from $1.8 billion, or $2.01 per share a year ago. Revenue increased 61% to $15.7 billion, from $9.7 billion last year.

Apple said it sold 3.5 million Macintosh computers, up 33% from a year ago, and 9.4 million iPods, down 8.6% from a year ago.

The company said about half of Macs sold in stores were to new Apple customers.

In April, the company projected per-share earnings of $2.28 to $2.39 on revenue of $13 billion to $13.4 billion. Wall Street's latest expectations were for a profit of $3.11 a share on revenue of $14.75 billion.

Gross margin fell to 39.1% from 40.9%. Some analysts had expressed concerns about the company's margins, saying the iPad isn't as profitable as other products.

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