Company Update (NASDAQ:AAPL): Apple Inc. Reports Record Third Quarter Results

Apple Inc. (NASDAQ:AAPL) announced financial results for its fiscal 2015 third quarter ended June 27, 2015. The Company posted quarterly revenue of $49.6 billion and quarterly net profit of $10.7 billion, or $1.85 per diluted share. These results compare to revenue of $37.4 billion and net profit of $7.7 billion, or $1.28 per diluted share, in the year-ago quarter. Gross margin was 39.7 percent compared to 39.4 percent in the year-ago quarter. International sales accounted for 64 percent of the quarter’s revenue.

The growth was fueled by record third quarter sales of iPhone® and Mac®, all-time record revenue from services and the successful launch of Apple Watch™.

“We had an amazing quarter, with iPhone revenue up 59 percent over last year, strong sales of Mac, all-time record revenue from services, driven by the App Store, and a great start for Apple Watch,” said Tim Cook, Apple’s CEO. “The excitement for Apple Music has been incredible, and we’re looking forward to releasing iOS 9, OS X El Capitan and watchOS 2 to customers in the fall.”

“In the third quarter our year-over-year growth rate accelerated from the first half of fiscal 2015, with revenue up 33 percent and earnings per share up 45 percent,” said Luca Maestri, Apple’s CFO. “We generated very strong operating cash flow of $15 billion, and we returned over $13 billion to shareholders through our capital return program.”

Apple is providing the following guidance for its fiscal 2015 fourth quarter:

  • revenue between $49 billion and $51 billion
  • gross margin between 38.5 percent and 39.5 percent
  • operating expenses between $5.85 billion and $5.95 billion
  • other income/(expense) of $400 million
  • tax rate of 26.3 percent

Apple’s board of directors has declared a cash dividend of $.52 per share of the Company’s common stock. The dividend is payable on August 13, 2015, to shareholders of record as of the close of business on August 10, 2015. (Original Source)

Apple shares are trading sharply down to $121.75 following the earnings announcement. AAPL has a 1-year high of $134.54 and a 1-year low of $93.28. The stock’s 50-day moving average is $127.16 and its 200-day moving average is $124.18.

On the ratings front, Apple has been the subject of a number of recent research reports. In a report released today, Macquarie analyst Ben Schachter maintained a Buy rating on AAPL, with a price target of $155, which represents a potential upside of 18.5% from where the stock is currently trading. Separately, on the same day, Deutsche Bank’s Sherri Scribner maintained a Hold rating on the stock and has a price target of $125.

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Ben Schachter and Sherri Scribner have a total average return of 40.3% and 4.2% respectively. Schachter has a success rate of 89.7% and is ranked #49 out of 3711 analysts, while Scribner has a success rate of 51.8% and is ranked #1352.

Overall, 2 research analysts have rated the stock with a Sell rating, 11 research analysts have assigned a Hold rating and 28 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $151.32 which is 15.7% above where the stock opened today.

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