Apple Inc on Thursday reported profit and sales that beat Wall Street expectations, navigating a parts shortage better than forecast and benefiting from steady demand for iPhones even as inflation has consumers cutting back on other spending.
Apple said sales and profit for the quarter ended June 25 were $83.0 billion and $1.20 a share, beating estimates of $82.8 billion and $1.16 a share, according to data from Refinitiv.
Apple is expected to provide guidance for the current fiscal fourth quarter during a call with investors, but Chief Financial Officer Luca Maestri told Reuters that demand for the iPhone had not slowed.
Investors watch Apple closely when economic indicators turn negative.
In the past, the iPhone maker’s loyal and relatively affluent customer base has helped it outperform other consumer brands.
While iPhone and iPad sales beat expectations, revenue from services, Macs and accessories missed Wall Street targets, and sales in the key China market fell 1%.
The latest economic woes include supply chain disruptions due to China’s COVID-19 shutdown that have crippled production of some Apple products such as iPads and Macs.
Apple, like many of its tech industry peers, is reportedly slowing hiring and cutting costs in the face of a tough economy.
Shares of Apple on Thursday fell 11% year to date, slightly less than the broader S&P 500 and also less than other consumer hardware makers such as Sonos Inc and Samsung Electronics Co .
It will be a key test of whether Apple’s years-long effort to diversify its business beyond the iPhone has paid off.
Apple said iPhone sales totaled $40.7 billion, up 3% from a year earlier and well ahead of the global smartphone market, which fell 9% in the most recent quarter, according to Canalys.
Growth in the company’s services business, which has boosted sales and profits in recent years, was 12%, down from a year earlier rate of 33%, and delivered $19.6 billion in revenue, below estimates of $19.7 billion.
Apple said it now had 860 million paying subscribers to either its paid services or to paid software in the App Store, up from 825 million in the previous quarter.
Apple had told investors to expect a hit of between $4 billion and $8 billion from supply chain disruptions, though it did not provide a full revenue forecast to offset those numbers.
Experts believed that the disruptions were hardening on the sale of Mac and iPads, with combination sites in a group of areas in China that went to Covid’s closure.
“Our June sub-quarter results continued to demonstrate our ability to effectively manage our business despite a challenging operating environment,” Maestri said in a statement.
iPad and Mac sales were $7.2 billion and $7.4 billion, respectively, compared with estimates of $6.9 billion and $8.7 billion.
Mac sales fell 10%, after the best sales since 2020, first due to the rise of home workers and then from Apple’s new proprietary processor chips.
Last fiscal year, nearly a fifth of Apple’s sales came from the Greater China region after two years of struggling sales there. But now Apple is facing sluggish overall economic growth in China, where its third-quarter sales were $14.6 billion, down 1%.
Apple delivers highest estimates as iPhone escapes recession – SABC News
Source link Apple delivers highest estimates as iPhone escapes recession – SABC News