NEW YORK: Apple reported solid earnings on rising revenue on Thursday (Oct 27), but the tech giant’s iPhone sales missed estimates while it saw slowing growth in services revenues.
Profit edged up 1% to US$20.7 billion (RM97.6 billion), on an 8% rise in revenues to US$90.1 billion in Apple’s fiscal fourth quarter ending Sept 24.
Shares edged lower in after-hours trading, a much better response than that of Facebook parent Meta and other tech giants that have plunged after results in recent days.
Those other tech behemoths have upset investors with varying problems ranging from weak online advertising revenue, swelling costs and disappointing forecasts.
By contrast, Apple notched growth in most operating regions and product categories and released an earnings statement that contained no obvious red flags and showed the company still able to notch broad-based revenue growth despite the drag from the strong dollar.
Results for the latest quarter “continue to demonstrate our ability to execute effectively in spite of a challenging and volatile macroeconomic backdrop”, said Apple CFO Luca Maestri.
“This quarter capped another record-breaking year for Apple, with revenue growing over US$28 billion and operating cash flow up US$18 billion versus last year.”
Still, Apple's smartphone revenues came in at US$42.6 billion, a bit below the US$43 billion projected by analysts.
The company also notched services revenue growth of just 5% compared with the year-ago period – much below the 12% jump in the prior quarter.
Heading into earnings season, investors had expressed worries about the headwinds from the weakening global economy as central banks enact aggressive interest rate hikes to counter grinding inflation.
This week's tech results have shown that the sector, which enjoyed outsized growth during the peak period of Covid-19, is not immune to these factors.
Shares of Apple slipped 0.8% to US$143.71 in after-hours trading.
“The iPhone number is a hint of the turmoil and uncertainty in the market, but Apple has different ways to offset,” said Runar Bjorhovde, a research analyst at market research firm Canalys.
Sales of Apple's Mac computers received a boost from this summer's introduction of redesigned MacBook Air and MacBook Pro laptops. New tablets went on sale this week.
Apple said its gross margin of 43.3% was a record for the September quarter. – AFP, Reuters
