Apple's fiscal second quarter earnings announced Tuesday proved to be a mixed bag for the company-record sales for the March quarter, offset by a drop in income. But Apple CEO Tim Cook is optimistic about the company's future, as he made clear during a conference call with analysts.
Here's an edited transcript of what Cook had to say on Tuesday about Apple's most recent quarter.
We're now halfway through our fiscal 2013 and we've accomplished a tremendous amount. We've introduced and ramped production of an unprecedented number of new products, and we've set many new sales records. Our revenue for the first half was over $98 billion, and our net income was over $22 billion. During that time, we sold 85 million iPhones, and 42 million iPads. These are very, very large numbers, unimaginable even to us just a few years ago.
Despite producing results that met or beat our guidance, as we have done consistently, we know they didn't meet everybody's expectations. And though we've achieved incredible scale and financial success, we acknowledge that our growth rate has slowed and our margins have decreased from the exceptionally high level we experienced in 2012.
Our revenues grew about $13 billion in the first half of this fiscal year. Even though that's like adding the total first-half revenue of five Fortune 500 companies, our average weekly growth slowed to 19 percent, and our gross margins are closer to the levels of a few years ago. Our fiscal 2012 results were incredibly strong, and that's making comparisons very difficult this year. Last year, our business benefited from both high growth demand for products, and a corresponding growth in channel inventories, along with a richer mix of higher gross margin products, a more favorable foreign currency environment, and historically low costs.
Apple remains very strong, and we will continue to do what we do best. We can't control items such as exchange rates and world economies, and even certain cost pressures, but the most important objective for Apple will always be creating innovative products. And that is directly within our control.
These compares are made further challenging until we [hit the] anniversary [of] thelaunch of the iPad mini, which as you know we strategically priced at a lower margin. As [chief financial officer] Peter [Oppenheimer] will discuss, we are guiding to flat revenues year over year for the June quarter, along with a slight sequential decline in gross margins.
The decline in Apple stock price over the last couple of quarters has been very frustrating to all of us. But Apple remains very strong, and we will continue to do what we do best. We can't control items such as exchange rates and world economies, and even certain cost pressures, but the most important objective for Apple will always be creating innovative products. And that is directly within our control.
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