Business
Apple Beats Earnings Estimates, But China Sales Decline Causes Stock Dip
Consumer electronics giant Apple reported better-than-expected earnings for its fiscal first quarter, driven by strong sales of its iPhone 15 handset and growth in services. However, the company’s stock dipped in extended trading due to declining sales in China. Apple earned $2.18 a share on sales of $119.6 billion, beating the estimates of Wall Street analysts. On a year-over-year basis, Apple’s earnings increased 16% and sales rose 2%, marking a return to revenue growth after four consecutive quarters of decline.
However, Apple’s sales in China fell 12.9% year over year to $20.8 billion, the only region where sales did not grow. Domestic smartphone vendors such as Huawei have been attracting customers away from Apple in China. Apple’s Chief Financial Officer, Luca Maestri, indicated weaker sales for the current quarter, forecasting overall revenue of $89.8 billion, below the FactSet consensus estimate of $95.6 billion.
Apple’s hardware sales in the December quarter reached $96.5 billion, a slight increase from the previous year, while services revenue climbed 11% to $23.1 billion. iPhone sales accounted for 58% of total sales and increased by 6% to $69.7 billion. Mac computer sales grew marginally to nearly $7.8 billion, but iPad tablet sales plummeted 25% year over year to $7 billion. Revenue from Apple’s wearables, home, and accessories unit declined 11% to about $12 billion.
Despite the positive earnings report, Apple’s stock dropped 3.3% in after-hours trading to $180.77. On Friday, Apple is set to launch its Apple Vision Pro spatial computer, its first major product launch since the Apple Watch. Meanwhile, Meta and Amazon experienced stock surges after their earnings announcements.