Record revenue and profits and a very healthy first holiday for the iPhone weren’t enough to soothe Apple investors, as lower-than-expected guidance sent the computer and media device maker’s shares plunging 11% in after-hours trading Tuesday.
Revenue rose 35% during the holiday quarter, the first on Apple’s fiscal calendar, to $9.6 billion. Net income rose 58% to $1.58 billion.
Revenue growth was highest for the computer division, but iPod devices and services provided the majority of Apple’s coin — more than $5 billion during the quarter. IPod unit sales were up 5% to 22.1 million, but revenue rose 17% to almost $4 billion, indicating that consumers were buying more expensive models like the new iPod Touch.
Company sold 2.3 million iPhones, generating $241 million in revenue from unit sales and its cut of service fees from partner AT&T. Strong perf indicates that after a somewhat sluggish debut for the device, the $200 price cut this fall has paid off.
Popular on Variety
In the current quarter, Apple predicted revenue of $6.8 billion and earnings per diluted share of 94¢. That’s up significantly from $5.26 billion and 87¢ last year but well below the expectations investors had built into high-flying Apple shares.
Apple recently launched movie rentals from all the major Hollywood studios on iTunes, partly in hopes of boosting its underperforming Apple TV. Company hasn’t released sales data for the device, which brings iTunes content into the living room, but it’s not nearly as successful as the iPod or iPhone.
Apple stock fell 4% to $155.64 before earnings were announced.