Apple Delivers Best-Ever Quarter, Powered By iPhones, Services

Apple has posted record results for the final three months of last year, delivering gains in sales of iPhones even as the company transitions to digital services and wearables.

Net profit hit an all-time high of USD 22 billion on record quarterly revenue of USD 91.8 billion, the California tech giant said of the results which were far stronger than most analyst estimates.

“We are thrilled to report Apple’s highest quarterly revenue ever, fuelled by strong demand for our iPhone 11 and iPhone 11 Pro models, and all-time records for services and wearables,” said Apple chief executive Tim Cook.

Apple’s net income in the holiday quarter ending December 28 set a new record for the California-based company, according to chief financial officer Luca Maestri.

The results come with Apple seeking to shift its revenue mix amid a slumping smartphone market and growing competition in the segment, and relying more on services such as music, streaming television and other digital content.

Shares in Apple jumped two percent in after-market trades that followed release of the fiscal first-quarter earnings, extending a remarkable streak for the company which a year ago had been dogged by concerns of a slowdown in smartphone sales.

Apple shares have doubled from a year ago—lifting its valuation to more than USD 1.3 trillion—as the company has expanded its services with a streaming television offering, digital payments and wearable tech such as its AirPods and updated Apple Watch.

Analyst Yoram Wurmser of the research firm eMarketer welcomed “a strong quarter for Apple, primarily driven by strong sales of the iPhone 11 lineup.” Apple bought back USD 20 billion in shares during the quarter and paid some USD 3.5 billion in dividends as part of a stated mission to be “net cash neutral” some time in the future, Maestri said.

Apple has stopped reporting unit sales for the iPhone, which has been the main cash-generator for the company in recent years, but sales revenue for its smartphone sales was up nearly eight percent in the quarter at USD 55.9 billion.

Services revenue rose 17 per cent from a year ago to USD 12.7 billion, driven by the launch of its Apple TV+ service and its new credit card.

The Apple TV+ on-demand streaming service launched in more than 100 countries at USD 4.99 per month, at a price lower than those offered by rivals such as Netflix.

For the category of wearables and home accessories—including its HomePod speaker, Apple Watch and other gadgets—revenue increased some 37 per cent to USD 10 billion.

Overall revenue was up slightly in its Greater China region, a keenly watched market for the company. Apple forecast revenue between USD 63.0 billion and USD 67.0 billion in the current quarter.