Apple post biggest earnings gain in nearly 2 years

Published on NewsOK Modified: July 22, 2014 at 5:16 pm •  Published: July 22, 2014
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SAN FRANCISCO (AP) — Apple's growth prospects are looking brighter as anticipation builds for the upcoming release of the next iPhone, a model that is expected to cater to consumers yearning for a bigger screen.

The latest evidence of Apple's mounting momentum emerged Tuesday with the release of the company's fiscal third-quarter report.

Earnings rose at the highest rate in nearly two years as Apple Inc. sold 35.2 million iPhones during the period. The iPhone shipments climbed 13 percent increase from the same time last year, even though many people are believed to be holding off on new device purchases until the next version comes out this fall.

"From an execution perspective, we did a really great job," Apple Chief Financial Officer Luca Maestri said in an interview with the Associated Press. "We have some things in the pipeline that we think people will really be excited about."

Apple earned $7.7 billion, or $1.28 per share, for the three months ending June 28. That represented a 12 percent increase from income of $6.9 billion, or $1.07 per share, at the same time last year. It's the first time that Apple's earnings have increased by more than 10 percent since the quarter that included the September 2012 release of the iPhone 5 — the last time that the company boosted the device's screen size.

The earnings per share for the latest quarter exceeded the average estimate of $1.23 per share among analysts surveyed by FactSet.

Revenue rose 6 percent from last year to $37.4 billion — about $600 million below analysts' forecasts.

If media reports based on leaks from Apple suppliers prove accurate, the iPhone 6 will boast a screen of at least 4.7 inches compared to the current 4-inch display. Some analysts also speculate Apple will simultaneously unveil an iPhone with a 5.5-inch screen.

An iPhone with a larger screen probably would unleash a flood of sales among Apple fans interested in a smartphone that would make it easier to read and see other features. A bigger-screen iPhone might also tempt consumers already accustomed to the larger screens on a variety of smartphones running on Google Inc.'s Android operating system.

Apple is also widely believed to be gearing up to release a smartwatch, a move that would mark the first time the company has entered a new device market since Tim Cook replaced Steve Jobs as CEO nearly three years ago. Jobs died in October 2011 after a long battle with cancer.

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