Another 'best ever' quarter for Apple

Stephen Withers
Tuesday, 20 October 2009 05:29

Opinion and Analysis

Talking of profit, the September 2009 quarter was the most profitable Apple has ever recorded. Total revenue of $US9.87 billion gave a net profit of $US1.67 billion.

"We are delighted with our September quarter and fiscal 2009 results," said Peter Oppenheimer, Apple's CFO.

"For the full year, we grew revenue by 12 percent and net income by 18 percent in extraordinarily challenging times. Looking ahead to the first fiscal quarter of 2010, we expect revenue in the range of about $US11.3 billion to $US11.6 billion and we expect diluted earnings per share in the range of about $US1.70 to $US1.78," he added.

Much has been made in some quarters about the possible impact of a proposed change to US accounting rules on Apple's results.

Currently, iPhone and Apple TV costs and revenue are recognised over 24 months, rather than at the time of sale. This is because Apple's interpretation of the regulations is that the possibility of delivering additional features and software free of charge at a later date means so-called 'subscription accounting' must be employed.

Some experts have disputed this interpretation, but the company has settled on this conservative approach.

If the rules had already changed, Apple would have reported substantially higher sales and profit.

However, Apple - like several other vendors - has been routinely incorporating 'non-GAAP' (generally accepted accounting principles) figures in its reports. So it isn't as if investors will suddenly be faced with a new set of numbers if the change goes through.

After all, the only thing that would change is the accounting treatment - the underlying reality would remain the same.