“Beloved” Apple iPhone X Delivers The Numbers
Apple has reported, claiming that they sold 52.2 million iPhones in the quarter, what’s not been explained is why their component suppliers are claiming sales are “Significantly” down while Apple claims they are on track.
Apple CFO Luca Maestri said that a big contributor to growth in the quarter was the Companies App Store which is the biggest driver of Apple’s services business, which saw strong year over year growth.
Apple says AirPods are a runaway hit and it is working hard to meet demand. No actual numbers are given. The HomePod mention was basically confirmation that the speaker had been launched which in Apple speak means that it is struggling.
When asked how sustainable is the $1,000 price point for the X?
Maestri said Customers chose the X over other iPhones each week in the quarter. “The iPhone X is a beloved product,” he says. He likens it to when a team wins the Super Bowl. You may want a higher score, but it’s still a winner.
Cook says revenues are up 14% for the iPhone year over year. That’s driven by the “ten.” He says the results show there are different kinds of buyers who want different kinds of iPhones.
What surprised a lot of analysts was that a reported 21% increase in revenue from Greater China in March behind strong sales of the $1,000 iPhone X, which outsold all other iPhones in the market. This was despite US President Trump introducing tariffs.
The Chinese revenue is Apple’s second greatest in a March period behind 2015 when it generated $16.82 billion in sales in the region. It is the third quarter of growth in China after six quarters of double-digit declines.
Overall the company has predicted a revenue range of $51.5 billion to $53.5 billion for the June quarter, with a midpoint ahead of the $51.6 billion Wall Street expected.
Apple also boosted its capital return program by $US100 billion, with repurchases from the increase set to begin in the June quarter, and said it bought $US23.5 billion of stock back in the March quarter, a sign that it is bringing back most of its hundreds of billions of dollars in cash to the United States.
The share repurchases in the march quarter drove Apple’s cash net of debt down slightly to $US145 billion.
The results sent Apple shares up 3.7 percent to $175.50 in after-hours trading.
Apple posted revenue for its March quarter of $61.1 billion, up from $52.9 billion last year.
Average selling prices for iPhones were US $728, compared with Wall Street expectations of $742. Maestri told Reuters that the company’s seasonal drawing down of iPhones sitting on store shelves accounted for some of the difference because it was concentrated on higher-end iPhone models this year.
In February, Apple said it planned to draw down its excess cash, though Chief Executive Tim Cook had downplayed the possibility of a special dividend.
In recent months, Apple has been emphasizing the size of its overall user base, which includes used iPhones, rather than focusing strictly on new device sales, a sign of the increasing importance of making money off users without selling them new hardware.