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Triple flavour in Apple juice
Revenues, profit top forecast

San Francisco, April 24 (Agencies): Apple Inc has approved another $30 billion in share buybacks till the end of 2015 and authorised a rarely seen seven-for-one stock split, addressing calls to share more of its cash hoard while broadening the stock’s appeal to individual investors.

The company also approved a roughly 8 per cent increase in its quarterly dividend to $3.29 per share.

Activist investor Carl Icahn, who had famously called on the iPhone maker to boost its buyback programme, tweeted his approval of the move on Wednesday.

Shares of the company, which had been stuck around the $500-$550 range since the start of the year, jumped 7 per cent to $561.51 in after-hour trade yesterday.

In a call with analysts, chief executive officer Tim Cook said the increased buyback was “a signal of the board and management team’s strong confidence in the future of Apple”.

On Wednesday, Apple reported sales of 43.7 million iPhones in the quarter ended March 31, far outpacing the roughly 38 million that Wall Street had predicted. That drove a 4.6 per cent rise in revenue to $45.6 billion — a record for any non-holiday quarter — and beating Wall Street’s projections for about $43.5 billion. The company had posted revenue of $43.6 billion in the same period the year earlier.

Earnings were up about 7 per cent in the last quarter at $10.2 billion compared with $9.5 billion in the same period a year ago.

Although the results beat expectations, the company’s rate of profit and revenue growth has slowed considerably in the recent quarters. The slowdown has put more pressure on Cook to release products in new categories.

But whether Apple can again produce a revolutionary product remains the central question in investors’ and Silicon Valley executives’ minds. “Believe we’ll also be happy when we see new products,” Icahn tweeted.

The smartphone market is maturing and rivals such as Samsung and Google are taking chunks out of its mobile-device market share.

Many hope that the next iPhone, which sources have said will sport a larger screen with new display technology, will provide a timely lift to the company’s bottomline come September, when Apple usually introduces the latest version of its core product.

Speculation persists that the company will take the lead in wearable devices with a smartwatch or other gadget, given that Cook has spoken about “new product categories” for 2014.

Sales of Apple iPad at 16.35 million were down from 19.5 million last year, despite a major redesign for one of the iPads introduced in the fall.

 
 
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