Apple Crushes Earnings

Apple just released 4th quarter earnings. Even with Apple's characteristic sandbagging, the numbers where absolutely huge. The company earned $1.01 vs. analysts estimates of $0.86. Apple beat on the top line as well. Some highlights of the most important points:

• Profits increased 67% year over year.
• Raised guidance for the next quarter. This is quite significant due to the fact that Apple is always very conservative with guidance.
• Sold 1.2M iPhones and more than 10M iPods. This is important because iPod growth continues at 18%, iPhones exceeded expectations, and the iPod does not appear to be cannibalizing iPod sales.
• iPod market share is lower outside of the U.S. meaning that there is a lot of growth potential internationally.
• iPhone will be launched in Europe and the U.K. soon.
• Apple continues to have an extremely strong balance sheet with $15B in cash and zero debt.
• Apple sold more than 2M Macintosh computers for the first time in its history. Apple might have taken "computer" off of their name but it is still a very large driver of revenues and profits.
• Apple's new operating system, "Leopard", begins shipping on Friday.
• Perhaps most important, gross margin for the quarter was 33.6%, up from 29.2% the previous year. That is vastly better than Apple’s competitors in either the computer or cellphone industries.

Steve Jobs and his team continue to execute flawlessly. Kudos.

Disclosure: at the time of this posting the author was long AAPL.