Apple Inc. reported second-quarter sales that beat Wall Street estimates, indicating that the iPhone is weathering an industrywide downturn better than feared.
Though revenue fell 2.5% to $94.8 billion, according to a statement Thursday, that was better than the $92.6 billion analysts predicted. Apple itself had projected a decline of roughly 5%.
The results suggest that Apple is bouncing back from a slump that’s plagued both the computer and smartphone industries. The iPhone performed better than expected in the quarter, helping offset weakness in much of the company’s lineup. It’s a particular relief for investors after Qualcomm Inc., a key Apple supplier, raised fresh concerns about phone demand earlier this week.
Apple also announced plans for $90 billion in stock repurchases, the same as last year’s plan. The company also raised its quarterly dividend 4% to 24 cents a share.
The shares gained more than 2% in late trading after the report was released. They had closed at $165.79, up 28% for the year.
Earnings came in at $1.52 a share during the second quarter, which ended April 1. That compared with an average estimate of $1.43 a share.
Apple generated $51.3 billion in sales from the iPhone — its flagship product — in the second quarter, topping analyst predictions of $49 billion. That’s just a 1.5% rise from a year ago but marked a record performance for the March quarter, Cook said. The increase came “despite the challenging macroeconomic environment,” he said in the statement.
From a supply perspective, the second quarter was an opportunity for the iPhone 14 to rebound. The device had suffered from constraints during the previous period due to Covid policies in China.
The iPad saw revenue fall 13% to $6.67 billion, roughly in line with estimates of $6.7 billion. New models, which included a revamped entry-level version and Pro models with M2 chips, didn’t do much to spur purchases in the quarter.
Likewise, revenue in the Mac division dropped 31% to $7.17 billion. That trailed forecasts of $7.7 billion. Research firms already warned that it was a bleak quarter for the lineup, with IDC estimating that Mac shipments fell about 40% in the quarter. Apple had updated the MacBook Pro and Mac mini, adding faster processors, but they failed to reignite the unit’s sales.
The home, wearables and accessories division, which includes AirPods, the Apple Watch and the TV set-top box — fell less than 1% to $8.76 billion. That beat estimates of $8.5 billion. The company added a faster processor to the Apple TV during the holiday quarter and updated its HomePod speaker during the March quarter.
The services business, which includes iCloud, Apple Music, the App Store and the TV+ streaming service, brought in $20.91 billion, missing estimates of $21.1 billion. Last quarter, Apple promised that services revenue — alongside the iPhone — would accelerate.
By Mark Gurman / Bloomberg