Apple Posts 'Record Quarter' on Strong iPhone, Mac, iPad Sales

Shares Stable in Wake of CEO Steve Jobs' Medical Leave

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NEW YORK ( -- A day after Apple's CEO, Steve Jobs, announced he was taking a second medical leave of absence, the company blew analysts' revenue estimates of $24.38 billion, raking in $26.74 billion in revenue in the three months ended December, up 70.5% from the same period last year. Apple also reported earnings of $6 billion, up 77.5% from $3.38 billion in the year-ago period.

Despite Mr. Jobs' announced leave, the company's stock price today closed down only 2.25%.

The Cupertino, Calif.-based company's ballooning revenue has been a theme all year, underscoring the significance of its runaway mobile products, the iPhone and the iPad, which was released in April. The company sold 7.33 million iPads in the most recent holiday quarter, bringing the overall tally to 14.79 million units, surpassing an estimate from market research firm iSuppli of 12.9 million for the year.

Altogether, Chief Financial Officer Peter Oppenheimer said the company had a "record quarter" in sales of iPads, as well as its Macintosh computers and iPhones, selling 16.24 million iPhones in the quarter, up 86% from the year-ago quarter and 4.13 million Macs in the same period, up about 23% from last year.

Despite the attention around the iPad, it only accounted for $4.61 billion in sales, behind the iPhone's $10 billion in sales and Macs, which generated $5.43 billion in sales.

Still, the company's virulent growth has caused consternation among institutional investors, some of whom have clamored that the company's cash hoard of close to $50 billion is "egregious," in light of its not having issued any dividends to shareholders. Mr. Jobs did indicate the cash could be used for a strategic digital acquisition, though such a ploy is as unclear as ever.

"We are firing on all cylinders and we've got some exciting things in the pipeline for this year, including iPhone 4 on Verizon, which customers can't wait to get their hands on," Mr. Jobs said in a prepared earnings statement, calling attention to his absence, though he generally does not participate on earnings conference calls.

Despite the company's record earnings, the company continues to undergo scrutiny along a number of its business practices, such as iPhone's future availability to other cellphone carriers and issues around potential exclusivity, as well as the sometimes opaque standards around its iTunes marketplace, such as how magazines and newspapers can create and sell their apps on the iPad, and how TV and movie rentals will be priced.

Observers and investors will ostensibly be offering a referendum on the legacy and significance of Mr. Jobs to the company's future growth, but a few key insights come from an unlikely source: former Apple CEO John Sculley, who currently runs his own investment fund. In an interview with website Cult of Mac, Mr. Sculley qualified his view of Mr. Jobs as a key character in Apple's continued success.

"On one level he is working at the 'change the world,' the big concept," Mr. Sculley said. "At the other level he is working down at the details of what it takes to actually build a product and design the software, the hardware, the systems design and eventually the applications, the peripheral products that connect to it. ... He's always adamantly involved in the advertising, the design and everything."

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