Apple recently reported that they sold 47.8 million iPhone smartphones in the latest period, up 29 percent from a year earlier and a new record. The company also revealed that it sold a record 22.9 million iPads (including the iPad Mini) in the most recent quarter, a 49 percent year-over-year increase.
The company's first-quarter earnings were $13.08 billion, up from 0.1 percent from $13.06 billion a year earlier, though margins have gotten worse over the past year. As a result, Apple shares fell to $463 after hours, the latest in a series of setbacks for the stock after reaching record highs.
"It's going to call into question Apple's dominance in the space. It's still one of the strong players, the others being Samsung and Google. It's still a two-horse race, but Android continues to grow rapidly," said Sterne Agee analyst Shaw Wu. "If you step back a bit, it's clear they shipped a lot of phones. But the problem is the high expectations that investors have. Apple's conservative guidance highlights the concerns over production cuts coming out of Asia recently."
Apple's revenue increased 18 percent to $54.5 billion, with 61 percent of the top line coming from international sales. Earnings per share fell to $13.81 a share from $13.87 a share as the latest period had slightly more shares outstanding.
"These results were OK, but they definitely raised a few questions," said Shannon Cross, analyst with Cross Research. "Gross margin trajectory looks fine so that's a positive and cash continues to grow. But I think investors are going to want to know what Apple plans to do with growing cash balance. And other questions are going to be around innovation and where the next products are coming from and what does Tim Cook see in the next 12 to 18 months."
Meanwhile, the company sold 4.1 million Macintosh computers, down 21 percent from a year ago. It also sold 12.7 million iPods, an 18 percent decline, something the company and analysts predicted.