Apple nearly doubles Q2 earnings

Sales of iPhones fuel crazy revenue, net income growth

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Looks like this Verizon thing is working out for Apple.

Fueled by a 113 percent increase in iPhone sales over the year-ago quarter, Apple (NASDAQ: AAPL) on Wednesday reported record second-quarter net income of $5.99 billion, or $6.40 a share, up 95 percent over the $3.07 billion, or $3.33 a share, in Q2 2010.

Revenue for the quarter ended March 26 was a record $24.67 billion, up 83 percent from revenue of $13.5 billion last year.

Consensus estimates called for net income of $5.35 a share on sales of $23.3 billion.

Gross margin declined slightly to 41.4 percent from 41.7 percent in last year's second quarter.

Shares of Apple were up 13.55, or 4 percent, to 355.96 from Wednesday's closing price of 342.41.

Apple said it sold 18.65 million iPhones in the second quarter, well above analysts' estimates of 16.3 million units and more than double the 8.75 million sold in 2010's second quarter.

Verizon began selling iPhones to U.S. customers in February, breaking AT&T's monopoly on the Apple smartphone.

Mac sales rose 28 percent to 3.76 million units from 2.94 million a year ago, though the 9.02 million iPods sold represented a 17 percent decline from the 10.89 million units sold in the second quarter of 2010. In fact, last year's Q2 iPod sales were down 1 percent from the second quarter of 2009, so it appears Apple's music device has peaked.

Apple sold 4.69 million iPads in the second quarter. The company introduced its tablet computer last April, thus there is no year-to-year comparison for Q2.

In a statement accompanying the earnings report, Apple CEO and co-founder Steve Jobs said, “With quarterly revenue growth of 83 percent and profit growth of 95 percent, we’re firing on all cylinders.”

That's an understatement.

Chief financial officer Peter Oppenheimer added, "Looking ahead to the third fiscal quarter of 2011, we expect revenue of about $23 billion and we expect diluted earnings per share of about $5.03."

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