In Tuesday’s Q3 earnings announcement, Apple crushed the street like King Kong crushes bananas. Apple earned $1.35 per share, up nearly 12% year over year (having earned $1.19/share in Q3 2008).

The company generated $8.34 billion in revenue, booking $1.3 billion in profit. Apple now has over $31 billion in cash on hand (up $2.2 billion for the quarter). This was the best non-holiday quarterly revenue in Apple’s history.

While Apple cut prices on MacBooks and iPhones in June (as much as 10%), gross margins were still up to 36.3%, compared to 34.8% the year-ago quarter.

Sales of iPhones and Macs (especially MacBooks) led Apple’s growth.

  • Apple shipped 2.6 million Macs during the quarter, a 4% increase over the year-ago quarter.
  • According to Macworld, 1.75 million of those Macs were notebooks. That’s up 13 percent from the 1.553 million notebooks sold last year-ago quarter.
  • Tim Cook reiterated that Apple’s goal is not to build the most computers, it’s to build the best computers.
  • Quarterly iPhone unit sales reached 5.2 million, a 626% increase from the year-ago quarter.
  • Apple hopes to have iPhone in China “within a year.”
  • International sales accounted for 44 percent of the quarter’s revenue.
  • Apple sold 10.2 million Pods during the quarter, which was a 7% unit decline over the year-ago quarter.
  • Despite the overall decline in iPod sales, Apple noted that sale of the iPod touch are still growing.
  • Peter Oppenheimer, Apple’s CFO, said “We expect traditional MP3 sales to continue to decline over time as we cannibalize ourselves with sales of the iPod touch and iPhone. But we still have a great business which we believe last many, many years, and we will continue to manage well.”

It was rumored that Steve Jobs would participate in the conference call, but chose to send a prepared statement instead:

“We’re making our most innovative products ever and our customers are responding. We’re thrilled to have sold over 5.2 million iPhones during the quarter and users have downloaded more than 1.5 billion applications from our App Store in its first year.”

Tim Cook, Apple’s COO (and acting CEO when Jobs was out on medical leave) noted that “The Mac has now outgrown the market a staggering 18 out of the last 19 quarters.”

Almost 20% of Fortune 100 companies bought 10,000 or more iPhones while some corporations and government organizations bought 25,000 or more iPhones. Tim Cook noted “We think we’re at the tip of the iceberg with what the iPhone can do with business customers.”

Regarding the future, Apple’s guidance for the fourth quarter of fiscal 2009 (which is actually the current quarter as of this writing) includes expected revenue of $8.7 billion to $8.9 billion and earnings per diluted share of $1.18 to $1.23. Apple is forecasting an increase in Mac sales during the back-to-school shopping season. It’s worth noting that Apple is notoriously conservative with its future estimates.

According to the Wall Street Journal, Apple is valued at $135 billion. That makes it the tenth most valuable company in America and 19th worldwide.

Read this article for a slightly bearish opinion of Apple’s stock price future in the Wall Street Journal.

Click here to read Apple’s press release on its third quarter results.

Click here to listen an audio webcast of Apple’s conference call discussing Q3 – 2009 financial results.

Click here to read Macworld’s in-depth converge of this matter.

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