Apple Forecast Tops Analysts' Estimates on New IPhones, Services

  • Apple Forecast Tops Analysts' Estimates on New IPhones, Services

Apple Forecast Tops Analysts' Estimates on New IPhones, Services

Of course, the iPhone still pulled down almost $30 billion in total revenue, but Services has rapidly grown from a minor segment of Apple's business to a major component.

However, a mix of strong revenue today and a market valuation that's closing in on $1 trillion are hyping Apple's stock price to record levels in after hours trading.

Apple's financial third quarter is traditionally quiet, coming in the slow summer months before the company's hotly anticipated refresh of the iPhone, the device that provides the lion's share of its revenues. The company's family of slates brought in $4.7 billion in revenue, down 5% on the year, suggesting the latest entry-level iPad's $329 starting price might be eating into the iPad's overall slice of the revenue pie a bit.

"Over time, it is inevitable that "other products" will become the third-largest revenue line item for Apple", notes Neil Cybart, Apple analyst at Above Avalon, ultimately overtaking Macs and iPads, while still behind iPhones and services. With a market capitalization of more than $900 billion, Apple is tickling at the title of world's first trillion-dollar company. The category includes the App Store, Apple Music, iCloud storage and Apple Pay.

Revenue reached $53.3 billion, an increase of 17% from a year ago and exceeding Wall Street's projections of $52.34 billion.

The US tech giant unveiled quarterly results revealing that iPhone sales had jumped to 41.3m, a slight increase on a year ago.

Despite the beat, James Cordwell, an analyst from Atlantic Equities, said the high selling prices might cause investors some concern because "there's a limit to how much Apple can grow the iPhone franchise by pushing pricing".

But several of Apple's services do not face strong rivals.

Analysts were eager for news from the California-based company about how the company is riding out trade turbulence between the United States and China.

Also drawing positive scrutiny are Apple's "other products" which includes AirPods earphones and HomePod speaker systems.

"We are not able to catch up to demand yet and continue to add capacity for the AirPods", Mr Maestri said. The revenue included US$236 million from resolving lawsuits such as Apple's long-running dispute with Samsung Electronics Co Ltd.

Apple's margins are facing pressure as it moves to put pricier components, such as OLED displays that show more vivid colours, into its products.

Apple said Tuesday that its profit had jumped more than 30 percent to $11.5 billion in the recently ended quarter, besting market expectations despite selling fewer iPhones than analysts projected.