Apple Q1 Beats Estimates; Expands Buyback Authorization; Announces Stock Split

(RTTNews) - Apple Inc. (AAPL) reported that its second-quarter net income increased to $10.22 billion or $11.62 per share, from $9.55 billion or $10.09 per share, previous year.

On average, 47 analysts polled by Thomson Reuters expected the company to report profit per share of $10.18 for the quarter. Analysts' estimates typically exclude special items.

Net sales increased to $45.65 billion from $43.60 billion. International sales accounted for 66 percent of the quarter's revenue. Analysts expected revenue of $43.53 billion for the quarter.

iPhone unit sales were up 17% year-over-year, while revenue from iPhone increased 14% from last year.

Gross margin was 39.3 percent compared to 37.5 percent in the year-ago quarter.

Tim Cook, Apple's CEO, said: "We're very proud of our quarterly results, especially our strong iPhone sales and record revenue from services. We're eagerly looking forward to introducing more new products and services that only Apple could bring to market."

Apple expects its third-quarter revenue to be between $36 billion and $38 billion. Analysts expect the company to report third-quarter revenue of $37.87 billion.

The company expects third-quarter gross margin to be between 37 percent and 38 percent.

Apple also announced that its Board has authorized another significant increase to the company's program to return capital to shareholders. The company expects to utilize a total of over $130 billion of cash under the expanded program by the end of calendar 2015. As part of the program, the Board has increased its share repurchase authorization to $90 billion from the $60 billion level announced last year. The company expects to continue to utilize about $1 billion annually to net-share-settle vesting restricted stock units.

The Board of Apple has approved an increase to the company's quarterly dividend of approximately 8 percent and has declared a dividend of $3.29 per common share, payable on May 15, 2014 to shareholders of record as of the close of business on May 12, 2014. The company also plans to increase its dividend on an annual basis.

The Board of Apple has also announced a seven-for-one stock split. Each Apple shareholder of record at the close of business on June 2, 2014 will receive six additional shares for every share held on the record date, and trading will begin on a split-adjusted basis on June 9, 2014.