Apple Results Top Estimates

(RTTNews) - Apple Inc. (AAPL) said Monday after the markets closed that its fourth quarter profit fell 9% from last year, hurt mainly by weaker margins even as revenue grew 4% on the back of strong sales of its iPhones.

However, the company's quarterly earnings per share breezed past Wall Street expectations as did its quarterly revenue. At the same time, the company gave an upbeat revenue forecast for the current quarter.

"We're pleased to report a strong finish to an amazing year with record fourth quarter revenue, including sales of almost 34 million iPhones," said Tim Cook, Apple's CEO. "We're excited to go into the holidays with our new iPhone 5c and iPhone 5s, iOS 7, the new iPad mini with Retina Display and the incredibly thin and light iPad Air, new MacBook Pros, the radical new Mac Pro, OS X Mavericks and the next generation iWork and iLife apps for OS X and iOS."

Apple also declared a cash dividend of $3.05 per share, payable on November 14 to shareholders of record on November 11.

Apple shares are currently losing 0.11% in after hours trading after closing the day's regular trading session at $529.88, up $3.92. The company's shares have fallen 24.85% since reaching their all time high of $705.07 on September 21, 2012.

Apple sold 33.8 million iPhones in the fourth quarter, up 26% from 26.9 million in the same quarter last year.

iPad sales for the quarter grew slightly to 14.1 million units from 14.0 million a year ago.

The company sold 4.6 million Macs in the quarter, down 7% from 4.9 million in the year-ago quarter.

Fourth quarter sales of the company's iPod music players dropped 35% to 3.5 million units.

The company's America revenue grew 1% year-over-year, while Europe revenue remained essentially flat and Greater China revenue rose 6%. Japan revenue surged 41%, while rest of Asia-Pacific revenue dropped 6% from a year earlier.

For the fourth quarter ended September 28, 2013, the Cupertino, California-based computing and electronics company reported net income of $7.5 billion or $8.26 per share, compared to $8.2 billion or $8.67 per share for the year-ago quarter.

On average, 47 analysts polled by Thomson Reuters expected the company to earn $7.93 per share for the fourth quarter.

This marks the third consecutive quarter of year-over-year profit decline.

Gross margin for the quarter shrank to 37% from 40% in the prior year quarter, while operating margin for the quarter narrowed to 26.8% from 30.4% a year earlier.

Revenue for the fourth quarter grew 4% to $37.47 billion from $35.97 billion in the same quarter last year. International sales accounted for 60% of the latest quarter's revenue. Forty-four analysts had a consensus revenue estimate of $36.84 billion for the fourth quarter.

Looking forward, the company forecast fiscal first quarter revenue of $55 billion to $58 billion. Analysts currently expect the company to post revenue of $55.65 billion for the first quarter.

Gross margin for the first quarter is expected to be between 36.5% and 37.5%.

Apple has a strong new product lineup for the upcoming holiday season. The company rolled out its latest smartphones iPhone 5s and iPhone 5c, on September 20. Last week, Apple unveiled two new iPads-- iPad Air and the new iPad mini, in time to tap the big spending holiday season. However, Apple is grappling with low-priced products from South Korea's Samsung Electronics Co. Ltd.

Apple is also under pressure to return more money to shareholders. After revealing a large stock position in the company, billionaire activist investor Carl Icahn has been pressing for a $150 billion share buyback.