Apple beats targets; to return $100 billion to shareholders

April 23, 2013: 4:57 PM ET

Reports revenues of $43.6 billion on sales of 37.4 million iPhones and 19.5 million iPads. Profits are down, as expected. Boosts dividend 15% and stock buyback five-fold

Screen Shot 2013-04-23 at 4.55.52 PMFORTUNE -- Against the advice of outside analysts, Apple (AAPL) bundled its good news and bad news together and released it all at once Tuesday.

Although profits were down, as expected, it beat its own guidance and Wall Street's expectations -- selling a ton of iPhones and iPads and collecting more than $43.6 billion in revenue. It also announced a plan to return $100 billion in cash to shareholders over the next two and a half years in the form of higher dividends and an accelerated stock repurchase plan.

"We are pleased to report record March quarter revenue thanks to continued strong performance of iPhone and iPad," said Tim Cook, Apple's CEO, in a press release. "Our teams are hard at work on some amazing new hardware, software, and services and we are very excited about the products in our pipeline."

The bad news -- that margins were at the low end of Apple's guidance and profits were down more than 18% from the same quarter last year -- had been telegraphed ahead of time and largely baked into the stock price.

Moreover the shortfalls were  tempered by the unexpected cash management announcements. Apple's cash hoard, which swelled to $145 billion in the quarter, is being returned to shareholders at an accelerated pace. The quarterly dividend was boosted 15% and the stock buyback program was increased from $10 billion to $60 billion.

Trading in Apple (AAPL), which ended the day at $406.13, up $7.46 (1.87%), was halted shortly before 4:30.  When trading resumed it leaped briefly to $429.9 before drifting down to $405, roughly where it started.

Some of the numbers:

Sales: $ 43.603 billion, up 11.3% year over year
Net profit: 
$9.5 billion, down 18.3%
EPS:
$10.09, down 18%
iPhone:  
37.43 million units, up 6.7%
iPad:  
19.5 million units, up 65.3%
Mac:  
3.952 million units, down 1.6%, compared with 14% for the industry
iPod: 5.633 million units, down 26.6%
iTunes sales: $2.4 billion, up 28%
iTunes/Software/Services: $4.114 billion, up 30%
Gross margin: 37.5%
Cash: $144.7 billion, up $7.6 billion from Q1; $102 billion overseas
Revenue guidance: $33.5-$35.5 billion
Gross margin guidance: 36-37%

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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