January 12, 2005: Apple reports record earnings for the preceding three months. Impressive iPod sales during the holiday period, and demand for the latest iBook laptop, give the company a four-fold increase in profits.
Apple brags that it sold a total of 10 million iPods, and rightly so. The massive popularity of the portable music player drives Apple to its highest earnings yet.
“We are thrilled to report the highest quarterly revenue and net income in Apple’s history,” said Apple CEO Steve Jobs in a press release. “We’ve sold over 10 million iPods to date and are kicking off the new year with a slate of innovative new products including iPod shuffle, Mac mini and iLife ’05.”
iPod sales power record Apple earnings
Today, big earnings for Apple are nothing new. While iPhone demand plateaued a few years ago, Apple’s services business ramped up. And increasing demand for Macs during the COVID-19 pandemic helped drive Apple’s market capitalization above the $3 trillion mark in early 2022 and again in late 2023. Apple’s market cap currently hovers just above $3.5 trillion, boosted in 2024 by high expectations for a “golden era of growth” fueled by artificial intelligence.
On this day in 2005, however, Apple was still climbing. The record earnings fueled by iPod saleswowed investors who still remembered the painfully bad old days of the 1990s.
In Apple’s January 12, 2005, earnings report, Cupertino revealed that it achieved sales of $3.49 billion in the previous quarter. That amounted to a massive 75% increase on the $2 billion it made during the same period the year before. Net profit for the quarter skyrocketed to $295 million, up from $63 million for the same quarter in 2004.
The iPod’s strong sales and phenomenal cultural impact proved key to Apple’s growth. The gadget became as much of a cultural fixture of 2005 as CSI, Guitar Hero and Carrie Underwood on American Idol.
Demand for the iPod could hardly have been greater, with the product line seeing a whopping 525% unit growth in the preceding three months. In all, it commanded approximately 65% of the portable music player market.
Apple wins with iTunes and Apple Stores, too
As mentioned, it wasn’t just iPod sales that fueled Apple’s mid-200s boom. While the iTunes music store pioneered a whole new way to sell music, Apple’s online store went from strength to strength. In the non-digital world, brick-and-mortar Apple stores continued to expand. (Apple had just opened its first store outside the United States.)
Mac sales also were rising, thanks to innovative products like the gorgeous iBook G4 (which received a late-2004 upgrade) and the powerful iMac G5, which stomped all over its PC rivals.
Looking back from today’s vantage point, what is so impressive about Apple in 2005 was the way the company managed to juggle its different products so effectively. Sure, the iPod’s astonishing sales numbers were the big focus — and the product line was about to benefit from the arrival of the newly announced iPod shuffle — but there was plenty of innovation happening elsewhere, too.
It was an exciting time to be an Apple fan. And, although we didn’t know it at the time, the best was yet to come.
What do you think was the best time to be an Apple fan? Is the company as exciting today as it ever was? Leave your comments below.
