Apple Earnings Boosted by iPhone Sales

22 Jul 2015 | Author: | No comments yet »

Apple Plunges On Light iPhone Sales, Weak Outlook.

Apple revenues for the month ending June 2015 rose 33% to $49.6 billion while earnings were up 45% to $1.85 a share — beating the Thomson Reuters I/B/E/S consensus by four cents a share.Apple’s iPhone shipments for the fiscal third quarter and the company’s revenue forecast for the current period missed analysts’ projections, raising questions over whether demand for the device has peaked.Apple (AAPL) this afternoon reported fiscal Q3 revenue and profit that trumped analysts’ expectations, but missed expectations for iPhone unit sales and missed with its Q4 revenue view, sending shares tumbling in late trading.

It’s that time again — Apple just dropped its Q3 2015 earnings and despite missing Wall Street’s always-lofty expectations, it’s been a solid three months of growth thanks to the two usual suspects. The company sold 47.5 million iPhones, lower than the most ambitious estimates of 48 million to 50 million; it sold 10.9 million iPads, about as expected; and it sold 4.8 million Macs, a little light of consensus. The good news for iPhones was that the average selling price of $660 was above expectations suggesting that sales were better “for the larger 6 Plus model which is particularly popular in China,” according to FT.

Meanwhile, iPhones were still far and away the most sought after gadgets in Apple’s portfolio with 47.5 million moved in a single quarter — not quite as much as last quarter’s blowout but a big lift over the year before. SUN VALLEY, ID – JULY 09: Tim Cook, chief executive officer of Apple Inc., attends the Allen & Company Sun Valley Conference on July 9, 2015 in Sun Valley, Idaho. (Photo by Scott Olson/Getty Images) Apple CEO Tim Cook was exuberant. The company forecast revenue of $49 billion to $51 billion in its fiscal fourth quarter, which ends in September, short of the average estimate for $51.1 billion. If one analyst, Toni Sacconaghi of Bernstein, is to be believed, that number would indicate lower-than-expected sales of the device in the quarter, its first quarter on sale. As he said, “We had an amazing quarter, with iPhone revenue up 59 per cent over last year, strong sales of Mac, all-time record revenue from services, driven by the App Store, and a great start for Apple Watch.

Any indication of slowing demand for iPhones could spark concern that Apple is going to have a hard time selling more smartphones in the final months of the year, after the September debut of the latest version fuelled record profits. Apple was less forthcoming about the watch, which some analysts and investors see as an important indicator of the company’s ability to produce successful new products.

The excitement for Apple Music has been incredible.” Investors may also be disappointed with Apple’s other products revenue — it includes iPod, Beats, Apple TV and Apple Watch sales — which totaled $2.6 billion. Top executives stood by their decision not to release sales figures for the company’s sleek new smartwatch, saying the information could be used by competitors. According to the New York Times, “Before the report, analysts had estimated that if revenue in the category exceeded $5 billion, it would be a sign that Apple had sold at least five million watches.” In one tantalizing clue, Apple reported $2.6 billion (U.S.) in revenue from the segment that includes the watch and several other products, or about $952 million more than the previous quarter, when the watch had not yet gone on sale. Apple will host a conference call with analysts at 5 pm, Eastern time, this evening, and you can catch a webcast of it on the company’s investor relations site.

Still, there’s perhaps just a little insight to be gleaned here since the category as a whole has only grown about a billion dollars since this time last quarter. It’s possible (if unlikely) that the Apple Watch drove all that growth despite the iPod’s near-irrelevance, but we’d figure some nice post-price cut Apple TV sales helped a lot too.

Apple also forecast that revenue for the quarter ending in September will fall between $49 billion and $51 billion, indicating total sales could fall below Wall Street estimates of $50.8 billion. IPad sales continued to suffer, with tablet shipments falling 18 per cent to 10.9 million, marking the sixth straight quarter of declines. – Bloomberg That beat the estimates of Wall Street analysts surveyed by FactSet, who were expecting Apple to report earnings of $1.81 per share on sales of $49.25 billion. Consumer demand for new models usually wanes as time passes, but Apple’s sales are continuing to grow faster than they did in a comparable period after the iPhone 5 went on the market in 2012.

Analysts say the company is also benefiting from its decision to offer bigger screens with the iPhone 6 and 6 Plus, which is helping to lure consumers away from competing phone-makers who started selling bigger-screen devices a few years earlier.

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