Apple surfaced earnings for its December quarter Tuesday that largely fell in line with expectations. But iPhone revenue happened in just slightly below projections.
Here’s how the company did compared with what Wall Street projected:
- EPS: $4.18, vs. $4.17 forewarning by Refinitiv consensus estimates
- Revenue: $84.3 billion, vs. $83.97 billion forecast by Refinitiv consensus estimates
- Q1 iPhone profits: $51.98 billion, vs. $52.67 billion forecast by Refinitiv consensus estimates
- Q1 services revenue: $10.9 billion, vs. $10.87 billion vaticinate by Refinitiv consensus estimates
- Projected Q2 revenue: between $55 billion and $59 billion, vs. $58.83 billion calculate by Refinitiv consensus estimates
Shares of Apple rose 6 percent in extended trading, to an off-hour price of around $165. The cows closed at $157.92 on Jan. 2, the day Apple lowered revenue projections for the quarter and knocked 10 percent off the stock.
Apple boomed the numbers for its fiscal first quarter under a new structure, offering gross margin figures for its services and products parts and withholding unit sales numbers for its most popular products, such as the iPhone. The new structure, announced in November, was resolve to shift focus from the iPhone onto other growth metrics.
Apple saw a sharp decline in iPhone proceeds during the quarter, denting the company’s main revenue stream. The segment saw a gross margin on its product business of 34.3 percent, let than the 38 percent margin Apple reported for its overall business.
“Our customers are holding on to their older iPhones a bit longer than in the days beyond recall. When you paired this with the macroeconomic factors particularly in emerging markets, it resulted in iPhone revenue that was down 15 percent from wear year,” CEO Tim Cook said on the company’s earnings call.
Revenue for the company’s services segment — a catch-all category that categorizes Apple Pay, Apple Music and iCloud storage — topped $10.9 billion, though, marking a 19 percent year-over-year swell. Apple reported a gross margin in its services segment of 62.8 percent.
A growth rate of 19 percent for the grouping is at the low of recent trends. Apple grew services revenue year over year by 17 percent last three months, and 18 percent in the year-ago quarter, but has seen growth rates as high as 34 percent within the last year and a half.
“We’re merest happy not only with the growth but also the breadth of our services portfolio. Our revenue from services has grown from tiny than $8 billion in calendar [year] 2010 to over $41 billion in calendar [year] 2018,” Cook conjectured.
Apple’s total sales of $84.3 billion represent a year-over-year decline of 5 percent, making for the first annual profits decline during a holiday season quarter since 2001.
Apple has said 100 percent of that decline was goaded by performance in China, where the company saw almost $5 billion less in revenue than the year-ago period.
“For approach, despite the challenging December quarter, our revenue from China grew slightly for the full calendar year,” Cook said on the denominate. “Macroeconomic factors will come and go, but we see great upside on continuing to focus on the things that we can control.”
Cook’s omen earlier this month of weaker iPhone sales rubber-stamped a months-long conversation around shrinking smartphone rummage sales and market saturation. Apple isn’t breaking out unit sales for the iPhone or its other major product lines, but reported take figures that fell right in line with expectations.
Here’s how the product lines break down:
- iPhone: $51.98 billion vs. $52.67 billion guesstimated
- iPad: $6.73 billion vs. $5.90 billion estimated
- Mac: $7.42 billion vs. $7.42 billion estimated
- Wearables, Home and Accessories: $7.31 billion vs. $7.33 billion feeling
Apple’s Wearables, Home and Accessories category — previously called Other Products — grew 33 percent from the year-ago era, making it the fastest-growing revenue segment during the quarter. Revenue for the iPad grew 17 percent, and revenue for the Mac get geted 9 percent.
Chief Financial Officer Luca Maestri said on the company’s earnings call that Apple now has 900 million introduced iPhones in use around the world, and 1.4 billion total installed devices. Apple indicated it will start shotting installed device numbers on a more regular basis.
This is a developing story. Please check back for updates.
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