Apple’s Q4 2013 earnings conference call kicked off with Apple CEO Tim Cook saying “Apple’s business is stronger than ever” while briefly discussing the company’s new and upcoming products. Cook said the company sold 150 million iPhones and 71 million iPads during the 2013 fiscal year. Apple also made more than $16 billion in revenue from iTunes software and services. Cook also said the company earned a record revenue of $171 billion in the 2013 fiscal year. Apple completed 15 strategic acquisitions during the year.
Apple CFO Peter Oppenheimer started his portion of the call by discussing the just announced quarterly results. Oppenheimer said both iPhone and iPad sales exceeded expectations in the quarter. He also spent a few moments detailing the upcoming iPads before discussing Mac sales.
Oppenheimer said iTunes earned 4.4 billion in the September quarter. App developers have earned $13 billion through the App Store — half of that amount was earned in the last year. Oppenheimer announced Apple has $146.8 billion in cash, with $5.2 billion offshore.
During the Q&A, Cook called new technologies in the iPhone 5s — such as the 64-bit processor and Touch ID — “the front end of a long road map.” Cook expressed a desire to see the iPhone business grow within each category, from the entry model 4s to the 5s. “We do need growth,” Cook said. “And we’re happy that we’ve seen that.”
Asked about new product categories in the second half of 2013 and first half of 2014, Cook said, “I didn’t say in April that you would see them in this year and the first half of next year.” He only said there would be “new products” this year and “across 2014.”
Cook was complimented on Apple’s growth in China. “We had a pretty good quarter in China,” Cook said. “We obviously we want to do better.” He pointed out the company was able to launch the new iPhones in the “first round” in China.
Asked about the difference in how often people are upgrading iPhones as compared to iPads, Cook said, “We do believe the announcement last week was our largest iPad announcement ever.” He also said, “iPad Air is an absolutely incredible product, the best iPad we’ve ever done. I think it’s going to be an iPad Christmas.”
When asked about the competition from low-priced Google devices, Cook concentrated on Apple’s improvements in the education sector. “We do see Chromebooks in some places … but the vast majority of people are buying PC/Mac or an iPad,” he said. Apple’s share of tablets in education is 94 percent.
Cook said there’s still a “backlog” for the iPhone 5s, but supply is building as the company rolls out the device to new countries. In regards to possible supply issues with the upcoming iPad mini with Retina display, Cook said it’s “unclear” if Apple can meet demand for the quarter. Cook noted Apple knows how many new iPad mini units it has, but isn’t quite sure of how high demand will be. As for the iPad Air, he said, “I think we’ll have a very good weekend,” but “it’s not clear” that everyone who wants an iPad Air will be able to get one.