For all the chatter about competition from Android, Apple isn’t on its uppers just yet. The company announced its latest quarterly financials last night, revealing $57.6bn of revenues and a $13.1bn net profit for the final quarter of 2013 – up 5.7% and flat respectively year-on-year.
Apple sold 51m iPhones and 26m iPads during the quarter, which were both records, as well as 4.8m Mac computers. The company ended the year with $80.3bn of current assets, leaving it well placed for further investments in 2014 and beyond: from the rollout of iTunes Radio across the world to sinking money into new manufacturing capabilities and (possibly) new devices like watches and TVs.
Some of the key points to pull out from a music industry perspective: Apple also saw record revenues from its iTunes software and services category, reporting iTunes Store billings of $4.7bn during the quarter – a total split between music, apps, video and books.
A separate stat: iOS app developers earned $2bn from their App Store sales during the quarter, which means just under $2.9bn of spending on apps (before Apple’s 30% cut) – which in turn means apps are now accounting for more than 61% of all iTunes spending.
Something else that’s not surprising, but still worth highlighting, is the decline of the iPod as a standalone device. “Sales declined by 52% year over year in the December quarter, and we would expect them to continue to decline year over year in the March quarter,” said CFO Peter Oppenheimer in Apple’s analyst conference call.
Apple still sold around 6m iPods during the quarter, but as CEO Tim Cook told analysts: “I think all of us have known for some time that iPod is a declining business.” As a business segment, iPod now accounts for 1.7% of Apple’s revenues.
And music? There was precious little music during the financial call: no update on iTunes Radio, and a solitary mention of music during Cook’s claim that “people love being able to buy content, whether it’s music or movies or books, from their iPhone, using Touch ID”.
Even so, those iOS device sales represent the bedrock for the global rollout of iTunes Radio and – eventually – whatever else Apple decides to do with streaming music. With reports that iTunes Radio is popping up on some non-US owners’ devices after restoring them, that rollout seems imminent, too.