Sat, Nov 03, 2018 - Page 10 News List

Investors punish Apple despite record earnings

DISAPPOINTED?The tech giant’s market cap dipped briefly below US$1 trillion as its fourth-quarter sales guidance was lower than analysts’ expectations

AFP, SAN FRANCISCO

Apple Inc on Thursday delivered blockbuster earnings, but saw shares punished after a disappointing holiday season forecast and word it would stop reporting how many iPhones it sells.

The California-based technology giant makes most of its money from iPhones, and sales numbers have been seen as a bellwether of the company’s fortunes.

Apple shares dove 6.4 percent to US$207.87 in after-market trades that followed release of earnings figures for a record-setting September quarter.

The world’s most valuable company saw its stock market value briefly dip below US$1 trillion.

The firm said net profit climbed 32 percent to US$14.13 billion on revenue that was up 20 percent to US$62.9 billion, aided by growing sales of digital content and services to users and other Apple gadgetry.

“We’re thrilled to report another record-breaking quarter that caps a tremendous fiscal 2018, the year in which we shipped our two billionth iOS device, celebrated the 10th anniversary of the App Store and achieved the strongest revenue and earnings in Apple’s history,” Apple chief executive Tim Cook said.

However, the market was disappointed that Apple fell short of expectations with sales of 46.9 million iPhones and its forecast for the key holiday season was not as robust as anticipated.

Apple offered no detailed breakdown of iPhone sales.

During an earnings call, Apple executives said that starting with this quarter its earnings reports would no longer specify numbers of iPhones or other products sold. Instead it would focus on revenue, margins and cost of sales.

Apple chief financial officer Luca Maestri said the change stemmed from the growing diversity of the company’s product line and assured analysts that Apple remained devoted to selling as many iPhones as possible.

He said it was the company’s best September quarter on record, with revenue growing double digits everywhere it does business around the world.

“We set September quarter revenue records for iPhone and wearables and all-time quarterly records for Services and Mac,” Maestri said.

Apple forecast that it would bring in between US$89 billion and US$93 billion in the current quarter.

Some analysts thought the estimate may have been conservative, with Apple being cautious about expectations as it works to balance supply and demand for a slew of freshly introduced products.

The latest report offers some positive news for Apple in growing its services, such as streaming music and Apple Pay, allowing the company to diversify its revenue stream in a saturated smartphone market.

However, the iPhone has been the key driver of revenue and profit for Apple, and also helps bring more consumers into the company’s ecosystem for apps and services.

Apple holds about 12 percent of the global smartphone market, with most of the rest sold by makers of Android-powered devices.

This story has been viewed 1751 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top