Investing.com -- Shares in Apple Inc (NASDAQ:AAPL) gained more than 1.5% in after-hours trading to reach an all-time high, after world's largest company in market capitalization posted better than expected earnings for the second quarter.
Boosted by strong earnings in its iPhone, Mac and App Store divisions, Apple reported quarterly earnings of $58 billion or 2.33 per share, above analysts' forecasts of $56.1 billion and 2.16 per share.
Following the release of the earnings report, Apple shares rose 2.01 points or 1.52% in after-hours trading to 134.66.
In terms of iPhones, Apple sold 61.2 million units for the period, above forecasts of 57.26 million. The spike in iPhone sales represents an increase of roughly 40% on a year-over-year basis. Upon closer analysis, Apple reported a 40% increase in sales in China, 20% in the U.S., 80% in Mexico and 100% in South Korea, according to CNBC.
"We are thrilled by the continued strength of iPhone, Mac and the App Store, which drove our best March quarter results ever,” Apple CEO Tim Cook said in a statement. “We’re seeing a higher rate of people switching to iPhone than we’ve experienced in previous cycles, and we’re off to an exciting start to the June quarter with the launch of Apple Watch.”
Apple also reported a gross margin of 40.8%, slightly above forecasts of 39.5%. Overall, the increased demand was reflected in a 71% spike in Chinese revenues (including Hong Kong and Taiwan), which surpassed the company's revenues in Europe. For the period, China ranked second in global sales of Apple products trailing only the United States.
“The tremendous customer demand for our products and services in the March quarter drove revenue growth of 27 percent and EPS growth of 40 percent,” Apple’s CFO Luca Maestri said in a statement. “Cash flow from operations was also outstanding at $19.1 billion.”
On a down note, Apple iPad sales fell 23% on a quarter-to-quarter basis to 12.6 million units below estimates of 13.94 million. Cook told CNBC that he is "very confident" that iPad sales will rebound.
The strong quarter has allowed Apple to increase its Capital Return Program to $200 billion. The company, Cook added, is returning cash to its stockholders "faster than expected."
"We're generating more cash than we've needed," Cook said.