Profits soar on iPod, iPhone sales

Apple brings in record earnings last quarter

The iPod phenom shows no signs of slowing down, as strong sales for the digital music player and a solid debut for the companion iPhone drove Apple to record earnings last quarter, causing its stock to shoot up 7% in after-hours trading.

Revenue for the Steve Jobs-led firm rose 29% to $6.22 billion, while net income was up 67% to $904 million.

Proving that its strategy of continually updating the device’s models is working, iPod sales rose a healthy 17% to 10.2 million for the quarter.

Despite initial worries about its sales momentum, Apple ended up selling just over 1.1 million iPhones in its first full quarter since it went on sale in June. Sales were undoubtedly helped by a 33% price cut to $400 in September.

Macintosh computers also did much better than expected, with sales up 34% compared with the same quarter last year to a record 2.2 million units. Though it still lags far behind sales of Windows PCs, Apple is undoubtedly hoping that mixed reviews for Microsoft’s new Windows Vista, as well as the halo effect of iPod sales, are boosting sales of the perennial underdog Macintosh system.

Company didn’t break out sales for its Apple TV device, which lets users stream digital video or music from a PC to a TV, however, indicating that it isn’t selling very well. That’s likely connected to Apple’s trouble in convincing studios to sell new movies on iTunes.

Apple is expecting that holiday sales will boost revenue in the current quarter to $9.2 billion.

Apple stock closed up 2% at $174.36 Monday before earnings were announced. In after-hours trading the stock topped $186.

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