Apple (AAPL) witnessed a decline of up to 3% in extended trading on Thursday after releasing its earnings report, which surpassed estimates for the quarter but came with a cautious outlook for the current quarter.
The company’s shares were down over 3% in premarket trading on Friday.
In its fiscal fourth quarter, Apple reported earnings per share of $1.46, generating revenue of $89.5 billion. Wall Street had anticipated earnings per share of $1.39 and revenue of $89.3 billion, according to Bloomberg estimates. Notably, this marked the fourth consecutive quarter where revenue fell compared to the same period in the previous year.
Despite the cautious outlook, Apple revealed that iPhone sales had increased to $43.8 billion in the fourth quarter, slightly exceeding expectations and setting a new record for iPhone sales during this period. Additionally, services revenue crossed the $22 billion mark for the first time.
However, revenues in the Mac, iPad, and Wearables categories declined compared to the same quarter in the previous year. For the recently completed fiscal year, Apple reported total revenue of $383.3 billion, a slight decrease from the prior year’s $394.3 billion.
During a call with analysts following the results, Apple’s CFO, Luca Maestri, indicated that revenue in the current quarter is expected to be “similar” to the previous year. Maestri also mentioned that the company foresees a significant deceleration in revenue for the Mac, iPad, and Wearables categories compared to the fourth quarter.
While Wall Street analysts had forecasted current-quarter revenue to reach $122.8 billion, Apple had reported revenue of $117.2 billion in the December quarter of the previous year.
In an interview with Yahoo Finance, Maestri attributed the expected decline in Mac sales to market conditions and described it as “very difficult compares versus a year ago.” He added that Apple continues to attract new buyers to the Mac, noting that “about half of buyers were new to the product in the quarter.”
In the iPhone segment, Apple anticipates revenue growth in the current quarter. The latest results also highlighted a strong performance in Apple’s home market, with sales in the Americas region increasing year-over-year, making it the only major geography to experience revenue growth.
Here are some key highlights from Apple’s quarter compared to Wall Street expectations:
- Revenue: $89.5 billion versus $89.34 billion expected
- Adjusted EPS: $1.46 versus $1.39 expected
- iPhone revenue: $43.8 billion versus $43.73 billion expected
- Services revenue: $22.3 billion versus $21.36 billion expected
- Mac revenue: $7.6 billion versus $8.76 billion expected
- iPad revenue: $6.4 billion versus $6.33 billion expected
- Wearables revenue: $9.3 billion versus $9.41 billion expected
Thursday’s report followed Apple’s recent unveiling of its latest MacBook Pro lineup and updated iMac during its ‘Scary Fast’ virtual event on the eve of Halloween.
