Apple enjoys its fourth straight quarter of revenue growth in Q2 2018

Aug 01, 2018, 06:42
Apple enjoys its fourth straight quarter of revenue growth in Q2 2018

Apple (NASDAQ:AAPL) posted the strongest third quarter in the company's history since it managed to beat analyst expectations for earnings per share and revenue. As for other hardware, Apple sold 11,553 iPads and 3,720 Macs.

Sales of the iPhone were up 20% at $29.9 billion, driven by the range-topping iPhone X, which starts at $999. Tim Cook said in early 2017 that he wants the service business to double its revenue to more than $14 billion a quarter by 2020. Higher iPhone average selling prices, increased services revenue, and unit sales growth for the Apple Watch should drive the expansion, analysts say.

Apple on Tuesday reported higher quarterly earnings and revenue than expected, as iPhone sales climbed and revenue from services like the App Store hit a record high. Apple also regained growth in China, where sales rose 19 percent.

Services revenue was US$9.5 billion, beating analyst expectations of US$9.1 billion, according to Thomson Reuters I/B/E/S. With a market capitalization of more than $900 billion, Apple is tickling at the title of world's first trillion-dollar company. Much of Apple's manufacturing takes place in China, and the Chinese market is Apple's second biggest when it comes to revenue, so the company could be affected in the future.

The tech company posted $53.3 billion in third-quarter revenue, up 17 percent from the same quarter a year ago.

The CEO also credited "wearables", a category that includes wireless earphones and the Apple Watch, with making growing contributions. It has also soothed investor concerns with a $US100 billion stock buyback program and promises of growth from services such as streaming music and video, where Apple faces competition from rivals including Spotify and Netflix.

Shares of the world's most valuable technology company jumped 3.9 per cent, in after-hours trade, to $US197.69 (at 5:25pm, local time). The revenue included US$236 million from resolving lawsuits such as Apple's long-running dispute with Samsung Electronics Co Ltd.

"We feel great about the results on iPhone", he said.

Apple said its gross profit margin will be 38 per cent to 38.5 per cent in the fiscal fourth quarter, versus analysts' estimates of 38.2 per cent.

Finally, while Cook expressed opposition to new trade tariffs between the United States and China, noting how they're anti-consumer, he said that Apple is continuing to see double digit growth in China along with other major markets. However, Cook said that current tariffs, such as one the United States imposed on steel and aluminum, do not directly affect the company's efforts.

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