Earnings Call Excerpt
Here's the entire text of the prepared remarks from Apple's (ticker: AAPL) Q3 2005 conference call. The Q&A, which followed the prepared remarks, is here. We recognize that this transcript may contain inaccuracies - if you find any, please post a comment below and we'll incorporate your corrections. And please note: we have paid to have this conference call transcribed, so feel free to link to it but reproduction is not permitted without the explicit permission of Seeking Alpha.
Apple's Q4 2005 Conference Call, Wednesday October 13th 2005
[Operator]: Good Day and welcome to this Apple Computer Conference Call to discuss Fourth Quarter Financial Results. Today’s call is being recorded. At this time for opening remarks and introduction I would like to turn the call over to Nancy Paterson, Senior Director of Investor Relations and Corporate Finance. Please go ahead ma’am.
Thank you. Good Afternoon and thanks to everyone for joining us today. Speaking is Apple CFO Peter Oppenheimer and he will be joined by EDT of Sales & Operations Tim Cook and BC and Corporate Treasurer Gary Whistler for the Q&A session with analyst. Please note that some of the information you will hear during this call consists of forward looking statements regarding revenue, gross margins, operating expenses, other income and expense, taxes, earnings per share, future products, Apple’s retail initiative and non-cash share-based compensation expense. Actual results will tend to differ materially from our forecast. For information please refer to the risk factors contained in the company’s Form 10K for 2004 and in Form 10Q for the first three quarters of 2005. Please also note that any non-GAAP financial measures included in today’s call should be viewed in addition to and in not in lieu of Apple GAAP results. Our reconciliation in any GAAP and non-GAAP measures discussed will be posted on Apple’s website at www.apple.com/investor. I would like to remind you that the first quarter of Apple fiscal 2006 will end on December 31, 2005 and will span 14 weeks instead of the usual 13 weeks. In connection with FEC rules on corporate enclosure, Apple is making this analyst call open to the media and general public by broadcasting the call live over the internet. With that I would like to turn the call over to Peter Oppenheimer for introductory remarks.
Thank you Nancy. Thank you for joining us. We are extremely proud that we’ve just completed the best year in Apple history. In fiscal ’05 Apple generated nearly $14 billion in revenue. More than doubling the company’s top line in the last two years. We shipped 4.5 million Macs up 38% from last year and 22.5 million iPods up 409% from last year. As a result, we earned a record setting annual profit of over $1.3 billion. For the Fourth quarter we are very pleased to report that another all time company record reporting revenue and earnings. Revenue of $3.68 billion or 57% year-over-year, and operating margins increased to 11.4% from 5.4% in the year ago quarter. Net income of $430 million grew 306% year-over-year, generating earnings per diluted share of $0.60. Earnings per share benefited by $0.12 from favorable tax adjustments that I will discuss later in my remarks. Recorded strong results were driven by very robust Mac sales, a highly successful back to school season and record iPod sales. As I’ve done in the past several quarters I will now provide highlights of our two businesses, Mac and Music.
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