Apple Outperforms But iPhone Sales Dropped
On October 28th Apple released its revenues and profits for its fiscal 2022 fourth quarter which ended on September 24, 22. Despite the volatile global market, the company noted a quarter-record revenue of $90.1 billion. Luca Maestri, Apple’s CFO explained that the company’s continued investments into their long-term growth plans are what has allowed the company to grow despite the globally high inflation and instability in the market, as it generated more than $24 billion in operating cash flow.
With the recent quarter revenues, Apple’s annual revenue was calculated at $394.3 billion, which would signify an 8 percent year-over-year increase. This revenue increase also marked an increase in the quarterly earnings per diluted share of $1.29 of 4 percent (year-over-year), while the annual earnings per diluted share similarly increased by 9 percent year over year, bringing them up to $6.11. Maestri in his remarks also shared that more than $29 billion would be returned to their shareholders.
Apple’s earnings show a performance that in most ways exceeded expectations at a time when many other tech giants appear to be suffering due to inflation and focusing on cutbacks. However, not all of Apple’s sales were as high as expected. Their iPhone sales did not manage to reach the Wall Street expectations of $43.21 billion. Instead in its fiscal fourth quarter, the sales of this product grew by around 10% going up to $42.6 billion.
This slight loss between the expected sales and actual sales in the iPhone division was made up by Mac sales, which far exceeded expectations. Apple’s oldest product was expected to draw in $9.36 billion but ended up being $11.5 billion. This marked a 25.4% increase in the sales of Macs.
According to the reported breakdown by revenue that Apple released, out of their four categories had increases in their year-over-year sales. Wearables, home, and accessories brought in around 9$65 billion, which marked a 9.8% year-over-year, while Services generated for the company $19.19 billion, up 5% year over year. The one category that did not manage to continue Apple’s upward trend was the iPad, which brought in $7.17 billion. Reportedly this is a decrease of around 13.1% year-over-year.
Despite the increases in Apple’s overall revenue, both iPad and services did not manage to reach their expected revenues bringing in $7.17 billion instead of the expected $7.94 billion, and $19.19 billion instead of $20.10 billion respectively. Still, the overall “products revenue” beat analysts’ expectations of $69.04 billion, as it reached $70.96 billion.
Apple is now preparing for its holiday quarter which they are expecting to be a lot slower than its fourth fiscal quarter. The company is predicting a drop in revenue growth of 8%. Even with this decrease, Apple does not expect to see its stock and shares decrease by the same amount that other giants such as Amazon.com AMZN.O have been experiencing ahead of the holidays.