Apple shares surged after iPhone earnings outweighed sharp drop in Mac sales

Apple Inc. has struggled. By supply pressures to show revenue growth continued in the June quarter, iPhone sales led better than expected despite a sudden drop in Mac sales.

The smartphone giant grew its revenue to $83 billion from $81.4 billion in the third quarter of the fiscal year, while analysts polled by FactSet expected $82.8 billion. Apple AAPL executives,
+ 0.36%
They warned on their last earnings call that they were expecting $4 billion to $8 billion in negative impacts related to supply chain issues during the June quarter.

“Our June quarter results continue to demonstrate our ability to run our business effectively despite the challenging operating environment,” Chief Financial Officer Luca Maestri said in a statement.

Earnings declined, with Apple reporting net income of $19.4 billion, or $1.20 per share, compared to $21.7 billion, or $1.30 per share, in the same period a year earlier. Analysts tracked by FactSet were expecting $1.16 in earnings per share.

Shares are up more than 3% in after-hours trading on Thursday.

The company beat expectations with its iPhone sales, reporting $40.67 billion in revenue for this category, up from $39.57 billion a year earlier. The consensus of FactSet was $38.59 billion.

The Apple Mac and iPad segments have seen significant growth during the pandemic, but the company saw declines in both categories for the June quarter, including a surprisingly large shortage of Macs.

The company reported $7.38 billion in Mac sales, down from $8.24 billion the previous year, while the FactSet consensus called for an increase to $8.74 billion. iPad revenue fell to $7.22 billion from $7.36 billion, but it came in ahead of the FactSet consensus, which was $6.85 billion.

Services revenue growth came in at $19.6 billion, up from $17.49 billion a year earlier. Analysts were looking for $19.75 billion.

The wearables, home, and accessories category generated $8.08 billion in revenue, down from $8.78 billion in the prior year quarter. The consensus of FactSet was $8.73 billion.

Executives declined to provide traditional financial guidance in the earnings statement. They have not provided quantitative forecasts since the pandemic began.

The Apple earnings call is expected to provide more information on how the company is weathering supply chain stresses and a weak macroeconomic landscape. Investors will be looking for indications about buying patterns, especially as Apple approaches fall, which usually leads to the release of new iPhone models. The call is scheduled to begin at 5 p.m. ET.

Apple shares have fallen 3.8% over the past three months as the Dow Jones Industrial Average DJIA,
+ 1.03%And the
Of which Apple is a component, it fell 4.1%.

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