Apple Announces Record Earnings For Quarter One

Apple is expected to release the next iPhone models, with new features, later this year. The decline only confirms the concerns of analysts who have been saying that iPhone sales are on a decline. Although the iPhone accounts for an estimated two-thirds of the company’s revenue, Apple has admitted that the sluggish growth is likely to continue.

The company inched past its previous record, established when it sold 74.5 million iPhones in the holiday quarter of 2014.

Apple Inc (NASDAQ:AAPL) traded up 0.55% on 27 January, hitting $99.99.

“But for the first time we’re seeing iPhone growth slowing which reflects something going on in the whole market”.

Cook squashed the notion of iPhone saturation, citing China’s exploding middle class, India, LTE wireless penetration in emerging markets, Android switchers and something I did not know, that most users have yet to upgrade to 6 or 6s (including the Tobak family, incidentally) as market opportunities.

“They have other products, and have the potential to launch other products, but the hole left from an iPhone slowdown is too big to fill”, said Abhey Lamba, an analyst at Mizuho Securities USA.

Apple Inc shares fell as much as 6 percent on Wednesday after the company reported its slowest-ever rise in iPhone shipments, with an uptick likely only after the expected launch of iPhone 7 in September. The iPad continued its nosedive, with 16.1 million units sold in the quarter, a huge 25 percent decline year on year.

“It’s the third largest smartphone market in the world, behind China and the US”, Apple CEO Tim Cook, said on an investor call.

Apple makes some of its services revenue directly from customers, such as iCloud and Apple Care.

The company posted record quarterly revenue of $75.9 billion and record quarterly net income or profit of $18.4 billion, the highest in the company’s history.

iPhone ASP: The average selling price of iPhones was $690, which beats the forecast ASP of $674.

The company reported revenue of $18.37 billion from Greater China, accounting for 24.2 percent of total revenue.

Speaking of services, Cook mentioned that consumers have spent billions of dollars in purchases through Apple Pay, which lets you pay at the cash register with the wave of your phone.

Ear-to-the-ground Apple blogs like 9TO5Mac have speculated the iPhone 7 will be thinner and come with wireless headphones, to lure the faithful to upgrade. The business’s revenue for the quarter was up 1.7% compared to the same quarter past year.

The quarterly results, which saw iPhone sales tick up ever so slightly from a year ago, are a testament to the challenges that Cupertino, California-based Apple faces in keeping the sales juggernaut humming.

Apple Watch and Apple TV both achieved record revenue as part of the “other products” category, which generated a relatively modest $4.3 billion in sales.

It will be hard to say if Apple will be able to meet the forecasts.

By revealing more details about its services business, Apple hoped to calm investors’ nerves about slumping iPhone sales. Analysts on average had projected earnings of $3.23 a share on sales of $76.5 billion, according to data compiled by Bloomberg.