Apple's Earnings Show Surprising Strength in the Recession

Apple (AAPL) easily beat Wall Street’s estimates for its fiscal Q2 2009. Analysts had expecting earning of $1.08 per share on $7.9 billion in revenue, but Apple reported earnings of $1.21 billion, or $1.33 per share, on sales of $8.16 billion.

Highlights from Apple's press release and earnings conference call:

• Revenue: $8.16 billion, up 8.16% from $7.94 billion in Q2 2008
• Profit: $1.21 billion, up 15.8% year-over-year from $1.045 billion
• EPS: $1.33 per diluted share up 14.6% from $1.16
• iPods: 11.01 million up 3.3% from 10.644 million
• iPhones: 3.8 million, up 123% from 1.7 million
• Macs: 2.22 million, down 3% from 2.289 million (desktop shipments down 4%, notebooks down 2%. Mac revenue down 22% (desktops), down 12% (laptops)
• Gross margin: 36.4%, up from 34.7% in Q1
• non-GAAP revenue: $9.06 billion, including deferred revenue from 7 quarters of iPhone sales
• Guidance for Q3: Earnings of $.95 to $1 on revenue of $7.7 to 7.9 billion

During the earnings call, when asked the old familiar "what about netbooks" question, COO Tim Cook gave the same answer Apple has given before: it's all about great products, buy an iPhone or iPod Touch if you want an Apple netbook.

For us, it's about doing great products. When look at netbook, cramped keyboard, terrible software, junky hardware, very small screens, just not a consumer experience. Not something that we would put the Mac brand on, quite frankly. It's not a space, as it exists today, that we're interested in or that customers will be interested in long term. But do look at the space and see how customers respond to it. People who want a small computer that does browsing and email might want to buy an iPod touch or an iPhone.

Makes you want to rethink those Q3 Apple netbook rumors, eh? But he didn't completely bash the idea, saying:

If we find a way that we can deliver an innovative product that really makes a contribution, then we will do that. We have some interesting ideas in this space.

Asked about Steve Jobs (surprisingly, well into the conference call), Apple CFO Peter Oppenheimer said:

We look forward to Steve returning to Apple at the end of June.

What, no WWDC surprise? Sounds like not, unless they simply want to keep it a surprise.