Apple Needs iPhone Prices to Stay Dialed Up

01 August, 2018, 08:56 | Author: Salvatore Jensen
  • Apple iPhone X

The Street had expected $2.18 per share and $53.31 billion, respectively. Prior to the earnings release, CNBC said that Apple could be spared the bloodbath due to its profitable hardware business, which online consumer companies like Facebook, Twitter, and Netflix lack.

Shares rose 3.4 percent to $196.80 in after-hours trade.

Apple moved 11.5 million iPads last quarter, up 1% on the year.

The company shipped 3.7 million Macs last quarter, down 13% on the year. The company's net income for the quarter was $11.52 billion compared to $8.72 billion a year ago.

The average iPhone now sells for $724. Apple said iPhone shipments edged about 1% higher.

Though it is rare for Apple shares to climb that much in a single day, it is not unprecedented - in July 2016 stock rose 6.5% in a day after financial results beat analysts' expectations. The company posted revenue of $53.3 billion.

But Apple is reportedly betting big on the design and features it introduced with the iPhone X. Rumors suggest that all three phones Apple is working on for the fall will mimic the iPhone X's design and adapt features like Animoji and Face ID unlocking. When asked about this on the earnings call, Cook called smartphones the world's best business to be in simply because of its size. ut he didn't provide a strong answer for concerns that the market has become saturated in developed countries or that users are upgrading their devices less frequently. Tim Cook spent an unusual amount of time focused on Apple's services division during the Q3 earnings call, and for good reason.




Mr Maestri said the company's so-called "wearables" business - which includes the Apple Watch and its AirPods headphones, among other items - has generated $US10 billion in sales in the past 10 quarters and saw sales increase 60 per cent in the most recent quarter.

Some of the more bullish Apple analysts believed Apple might report $9.2 billion in services revenue for the June quarter.

All those iPhone sales help Apple in another way - services like Apple Music, the App Store and elsewhere are booming.

The world's most valuable technology company also forecast revenue of US$60 billion to US$62 billion for its fiscal fourth quarter, which will include early sales of soon-to-be-announced phone models, beating the US$59.6 billion analysts expected, according to data from Thomson Reuters I/B/E/S.

Apple said its gross profit margin will be 38 per cent to 38.5 per cent in the fiscal fourth quarter, versus analysts' estimates of 38.2 per cent. Analysts expected revenue of US$52.4 billion and earnings of US$2.18 a share.

The maker of iPhones, iPads and other products posted revenue of nearly $53.3 billion in the period, also exceeding Wall Street forecasts.

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