Apple reports blockbuster quarter as iPhone sales top estimates

Shares of the world's most valuable listed company were up 2.6 percent at $124.50 in after-hours trading on Tuesday.

Apple sold 78.29 million iPhones in the first quarter ended Dec. 31, up from 74.78 million last year, marking the first quarterly growth in iPhone sales in a year.

Analysts on average had estimated iPhone sales of 77.42 million, according to research firm FactSet StreetAccount.

The results, which reflected the first full quarter of iPhone 7 sales, come at a time when global demand for smartphones is slowing and cheaper Android alternatives are flooding the market.

Revenue in the Greater China region fell 11.6 percent to $16.23 billion, highlighting Apple's struggles in a hotly contested smartphone market.

The company also forecast revenue of between $51.5 billion and $53.5 billion for the current quarter. Analysts, on average, had expected revenue of $53.79 billion, according to Thomson Reuters I/B/E/S.

Apple Chief Financial Officer Luca Maestri said that a stronger dollar hurt the company's revenue forecast.

Analysts on average expect the company to sell 53.43 million iPhones in the current quarter, according to FactSet.

The company is heavily dependent on the success of iPhones, which account for 69.4 percent of its total revenue.

Analysts and investors have already set their sights on Apple's 10th-anniversary iPhone, which is expected to feature better touchscreen technology, wireless charging and a shift to OLED display.

Apple's services business - which includes the App Store, Apple Pay and iCloud - recorded a 18.4 percent growth in revenue to $7.17 billion, helped by the popularity of games, including Pokemon Go and Super Mario Run, and increased revenue from subscriptions.

Cowen & Co. and Mizuho Securities had expected revenue of about $7 billion, while FactSet had forecast $6.91 billion.

Analysts expect growing revenue from Apple's services segment to help offset declining hardware sales as the smart phone market matures.

The company's net income fell to $17.89 billion, or $3.36 per share, in the quarter from $18.36 billion, or $3.28 per share a year earlier. Analysts on average had expected $3.12 per share.

Revenue rose 3.3 percent to $78.35 billion in the quarter.

Analysts had expected revenue of $77.25 billion, according to Thomson Reuters I/B/E/S.

Up to Tuesday's close, Apple's shares have gained 14.7 percent since mid-November, compared with the 5.3 percent rise in the Dow Jones Industrial Average.

source: news.abs-cbn.com

For Apple, surprise hunger for big phones leaves money on table

Apple Inc. said it was caught off guard by how many people want to buy its biggest smartphone, the iPhone 7 Plus, and the miscalculation may hit profits this holiday season.

The technology leader is not sure it can make as many units of the iPhone 7 Plus as consumers want in time for the Christmas shopping rush, Apple's Chief Executive Tim Cook told analysts on Tuesday. It will manage to make enough of the smaller iPhone 7s, though, he said.

Demand was strong "particularly on the iPhone 7 Plus versus our forecast going into the product launch," Cook said.

The bigger phones bring bigger profits, and Apple's forecast for thinner-than-expected margins concerned investors after it reported quarterly earnings on Tuesday.

Apple issued a conservative outlook on margins for the holiday quarter, 38 percent to 38.5 percent, versus expectations of nearly 39 percent, said Mariann Montagne, senior investment analyst and portfolio manager at Gradient Investments.

It was not immediately clear if the smartphone shortage caused the miss.

"You're not able to get that product into the hands of the person who wants it right here, right now," said IDC analyst John Jackson. "Those are dollars not in your hands."

The Cupertino, California-based company unveiled its newest iPhones on Sept. 7. The 5.5-inch (14 cm) Plus model is the first iPhone to have a dual camera on the back that lets users take better portrait shots and zoom in from further away.

"It's inherently tough to know how things like new finishes and features are going to affect demand for a new model," said analyst Jan Dawson of Jackdaw Research.

Apple is still getting to know how consumer interest varies for larger and smaller phones, having launched two competing sizes only in 2014, he said.

The company also may have underestimated the number of customers it would win from Samsung Electronics Co. Ltd., which recently recalled its own large format phone, the Galaxy Note 7, after a number of them caught fire.

Apple Chief Financial Officer Luca Maestri told Reuters in an interview it was "impossible to know" the effect of Samsung halting production of the Note 7 earlier this month.

"We cannot fulfill all the demand that is out there right now," he added.

Speeding up production would be difficult, analysts said. The company cannot contract new suppliers, hire more workers and open factories overnight, said Trip Chowdhry, managing director of Global Equities Research.

"You can't just shoot iPhones out of an assembly line at the speed of a bullet," he said. "Apple does things to perfection. There is no need to rush and create an inferior product the way Samsung did."

source: www.abs-cbnnews.com

Apple Watch to be sold at Best Buy stores from August

The Apple Watch will be available at stores of Best Buy Co Inc, the largest U.S. consumer electronics chain, starting Aug. 7.

The Apple Watch and Apple Watch Sport models will be sold at more than 300 Best Buy stores in time for the holiday shopping season, a spokeswoman for Apple Inc said.

"Customers love Apple Watch, and we are thrilled to begin offering it at Best Buy," she said in an email.

Best Buy is the first retailer to sell the watch outside of the Apple retail store.

"The Apple Watch is an important addition to an emerging product category, and we know our customers want it," Jason Bonfig, senior category officer, said on the Best Buy website.

The company said the product will also be available on its online store BestBuy.com.

The Wall Street Journal first reported that the Apple watch was coming to Best Buy.

Apple Chief Financial Officer Luca Maestri told Reuters earlier this month that sales of the Apple Watch had beat the company's expectations. He said in the nine weeks since its launch in late April, the device had sold better than either iPhones or iPads over a similar period after their launch.

(Reporting by Rama Venkat Raman in Ben)

source: www.abs-cbnnews.com

Apple gives weak forecast, shares fall nearly 7 pct

BENGALURU/SAN FRANCISCO - Apple Inc. shares slumped nearly 7 percent in after-hours trading as its fourth-quarter revenue forecast fell short of estimates and it missed some targets for iPhone sales.

The shares dropped to $121 after the company released its results on Tuesday, from $130.75 at the close.

The forecast overshadowed Apple's strong sales in China, which more than doubled to $13.23 billion from a year earlier.

Apple Chief Financial Officer Luca Maestri said in an interview the results in China were "spectacular" during the quarter and noted plans to open 40 stores there over the next 12 months.

Without disclosing specific figures, Maestri said sales of the Apple Watch beat the company's expectations. He noted that in the nine weeks since its launch in late April, the device has sold better than either iPhones or iPads over a similar period after their launch.

Apple said on Tuesday it sold 47.5 million iPhones in the third quarter, up 35 percent from a year ago. But some analysts had expected around 49 million.

Colin Gillis, an analyst for BGC Partners, said the results highlighted the vulnerability of Apple's dependence on the iPhone and the Chinese market's growing importance to the company.

"Where are you going to find growth in the world?" he said. "You've done an amazing job sucking all the smartphone profits into your balance sheet, but smartphone sales are slowing. What's going to happen when the industry matures, just like PCs did?"

The company forecast revenue of $49 billion to $51 billion, missing analysts' average estimate of $51.13 billion according to Thomson Reuters I/B/E/S.

The company's iPhone 6 and 6 Plus, which shattered iPhone sales records when they were launched, are already 10 months old.

Apple had a troubled day, with its App Store, Apple Music, iTunes Store and some other services suffering disruption for more than three hours before results were released.

source: www.abs-cbnnews.com