Apple sells 21.1 million iPods during Christmas quarter

Cupertino (CA) - Apple reported yet another strong quarter with record sales results throughout its product portfolio. Driven by strong demand for notebooks, iPods and the iTunes music service, revenues came in at $7.1 billion, which translates into a year-over-year increase of 22%. Apple’s profit surged 78% from $565 million top $1.0 billion.

The iPod product line continues to carry Apple from one record quarter to another. According to the company, 21.06 million music players were sold during the Christmas quarter, representing a 50% increase year-over-year and a 142% increase over Apple’s fiscal fourth quarter of 2006.

The company claims that the iPod held a 72% market share among portable audio players in the U.S. during December and stated that, combined with other products such as iTunes, accounted for 57% of the firm’s revenue. According to Apple, iTunes saw its revenue grow 29% year-over-year and held an 85% market share in U.S. music download services in December 2006.

The company’s Mac computer sales also outpaced the rest of the industry. Unit shipments grew 28% to 1.61 million year-over-year ; Apple stated that much of the growth came from notebook shipments which accounted for 60% of all Mac systems sold during Q1.

On the downside, revenue growth of Apple stores slowed considerably to about 6% yea-over-year. Chief financial officer Peter Oppenheimer said that this slowdown can be attributed to the price reduction of iPods in September of 2006 as well as a "well stocked distribution channel" that impacted iPod sales through the firm’s stores. Oppenheimer said that improved store growth will return with the introduction of the iPhone in June.

Apple stock was down 2.2% for the day, but gained about 0.8% in after hour trading.