iPhone Sales Up, Apple Profits Down
The iPhone 5 must come with some pretty sweet features. U.S. shipments of the iPhone rose 51 percent in the third quarter, setting a sales record and buoying Apple Inc.’s stock and causing the company to beat out Wall Street’s expectations. But that wasn’t enough to actually cause profits—the company said Tuesday that profit fell 22 percent in the quarter, and gross margins were down 37 percent from more than 42 percent in the same quarter last year. The high U.S. sales of the iPhone are encouraging, but China’s economic decline weakened the company’s revenue. But all the iPhone sales don’t help with investors’ biggest concern about Apple: that the company’s days as innovators are over.
