Apple's quarterly report: 17 million iPads, 26 million iPhones sold

Apple is probably the only company in the world to severely disappoint Wall Street by reporting 20% growth compared to the same quarter a year earlier. Most companies would love to have that sort of growth. The problem is that Apple had been growing at a phenomenal and unprecedented 50-120% rate the past 10 quarters. By most measures, it was a great quarter for Apple, which sold 17 million iPads and 26 million iPhones. That was a record number of iPads, and a big jump from the previous quarter's 11.8 million. Some analysts considered this a good sign, because in the context of declining PC sales, it suggests that people are now buying iPads rather than PCs. That means there's a lot of upside. Apple also reported selling 2 million iPads to schools. This will also likely be an area for growth. Plus, the iPad just became available in China, so it's likely that sales will continue to increase.

iPhone sales weren't quite what Wall Street expected, and the consensus seems to be that "only" 26 million were sold because consumers were holding out for the iPhone 5. Yet 26 million is a hefty number, and a 28% increase compared to the same quarter a year earlier. By way of comparison, though, Apple sold 37 million iPhones in last year's December quarter, which was the first quarter that the iPhone 4S was available.

Analysts have kept expecting Apple to run into the "law of large numbers": it's simply impossible to keep growing at a rate of 50% per quarter. So there were many saying, "I told you so." Still, they're bullish on Apple overall, and expect the stock to keep going up for a while.

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The iPhone now accounts for 46% of Apple's revenue, and the iPad 26%. Combined, that's nearly three quarters of Apple's revenue. Remember five years ago when Apple was mainly a computer company? The Mac now accounts for just 14% of Apple's revenue, while the iPod comes in at 3%. iTunes accounts for 6%.

Half of the iPods sold are now the iPod touch. This is seen as a good sign — that consumers who buy the touch may eventually move to the iPhone or iPad.

Sales of the Apple TV continues to grow, with 1.3 million sold during the quarter, representing an amazing 173% increase compared to the previous quarter. This, too, is a good sign — suggesting increased interest in Apple's TV offering and a potential market should Apple offer a TV set. 

In the short term, things still look good for Apple. In the long term, they'll inevitably have to come up with more game-changers like the iPod, iPhone, and iPad. And if anyone can do it, Apple can. They've been on a remarkable run the past 12 years. Some analysts are looking to the iPad mini and an Apple TV set to give Apple a further boost. But you have to wonder if maybe there's a product they're working on that, one more time, creates a new category, a new market. It's hard to imagine what that might be, but no doubt it's lively in the minds of Apple's very creative engineers and designers.

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Jim Karpen holds a Ph.D. in literature and writing, and has a love of gizmos. His doctoral dissertation focused on the revolutionary consequences of digital technologies and anticipated some of the developments taking place in the industry today. Jim has been writing about the Internet and technology since 1994 and has been using Apple's visionary products for decades.