Apple sells nearly 40m iPhones in three months of year 'for the record books'

Apple sold a record 39.3m iPhones in the last three months, the company said on Monday, helping the tech giant win its highest revenues of the year.

Entering the Christmas shopping season, its strongest sales period of the year, Apple predicted its latest iPhones would help boost sales by at least 10% during the crucial holiday quarter.

Overall, the company’s profit rose more than 12% from a year ago, to $8.5bn. Total sales also rose more than 12%, to $42.1bn.

The one blemish on Apple’s quarter came from iPad sales, which slipped 13% compared to the same period last year, the third quarter in a row that sales of the tablets have fallen.

“Our fiscal 2014 was one for the record books, including the biggest iPhone launch ever with iPhone 6 and iPhone 6 Plus,” Tim Cook, Apple’s chief executive said. “With amazing innovations in our new iPhones, iPads and Macs, as well as iOS 8 and OSX Yosemite, we are heading into the holidays with Apple’s strongest product lineup ever. We are also incredibly excited about Apple Watch and other great products and services in the pipeline for 2015.”

Demand for the new iPhones “has been staggering”, said Cook. “At this point we are selling everything we’ve made.”

The company ended the year with $155.2bn in cash and marketable securities. Revenues at Apple’s retail rose 15% to $5.1bn. Apple is planning to open 25 new stores in fiscal year 2015. Most will be outside the US.

The results were ahead of forecasts. Wall Street had predicted that Apple would sell 38m iPhones in the three months to the end of September, a 12% rise on the 34m mobiles sold by in the same period last year.

Sales of iPad’s were worse than predicted. Analysts had expected the figure to fall 8% year on year to 13m units, but Apple only sold just over 12.3m units.

In September the company launched two new iPhones: the 4.7-inch iPhone 6, and the 5.5-inch iPhone 6 Plus. Apple also unveiled the Apple Watch, its first new product category since the iPad in 2010, although the smartwatch will not be available until early 2015. Apple also introduced Apple Pay, a new iPhone-based payment system for buying goods in the stores. Apple Pay started its roll out Monday.

Last week Apple launched a new iPad, the iPad Air 2, and updated the iPad Mini. It also launched its new operating system, OSX Yosemite.

The only new product available during the latest quarter was the iPhone, so the new launches had little impact on earnings.

Apple’s shares rose in after-hours trading, climbing 2% to over $100 after closing the day at $99.76. Activist investor Carl Ichan has predicted that the company’s share price is set to double.

He is pressing the company to buyback more of its shares and, in a 4,500 word letter to Cook, implied that Apple should have a stock market valuation of $1.2tn. The company is already the most valuable in the US, with a market cap of $584bn. In the analysts call Cook said the company has returned $45bn in the last year to shareholders – including $17bn in the quarter.