Apple reported fourth quarter earnings on Thursday.
AFP / Getty Images
Record sales of Macs helped Apple Inc. make up for the shortage of new iPhones in the fourth quarter of fiscal as the COVID-19 pandemic continued to fuel soaring demand for remote work tools.
The iPhone business lagged in the September quarter. Apple beat general expectations in an earnings report on Thursday, in part due to resurgent Mac sales. Mac sales of $ 9 billion were more than $ 1 billion more than what analysts expected given the growing need for products that make working and studying easier from home.
Still, shares fell 5.2% after close on Thursday as Apple again declined to issue a financial forecast in the face of the pandemic. Investors and analysts were hoping for guidance that would give a clearer idea of what Christmas sales of the new iPhones might look like after a delay related to COVID-19 forced the new smartphones to sell later than Apple’s usual.
CFO Luca Maestri said on Apple's call for profits that the company expects iPhone sales to grow in the December quarter, "although the iPhone 12 and 12 Pro shipped four weeks in the quarter and the iPhone 12 mini and 12 Pro Max seven weeks in the quarter will". He also assumes that “all other products as a whole” will grow by double digits, as will the service business.
Although Apple's sales in Greater China fell from $ 11.13 billion in September to $ 7.95 billion, Chief Executive Tim Cook said on Apple's call that the company was "confident it will be in this quarter China will grow ".
Apple's optimistic Mac September quarter results are in line with general trends in the personal computer industry. Third-party analysts at Gartner and IDC point to the strongest growth in the PC market in more than a decade. The company appeared to be benefiting from the school systems when Cook pointed out that the company has launched nine of its ten largest school outreaches that will support more than 1 million students and teachers.
In many other years, Apple's fourth fiscal quarter received a boost from early sales of the company's latest iPhone models. Apple delayed the launch of the iPhone 12 this year due to the COVID-19 crisis, but the rest of the business has picked up as Apple beat expectations in the other four product categories.
Don't Miss: Apple is bringing 5G to iPhones but keeping the same prices
Total Apple revenue rose to $ 64.7 billion in the quarter from $ 64.04 billion a year ago, while analysts surveyed by FactSet modeled $ 63.7 billion. The company reported net income of $ 12.67 billion, or 73 cents per share, compared to $ 13.68 billion, or 76 cents per share, for the year-ago quarter. Analysts tracked by FactSet modeled a profit share of 71 cents.
Apple posted a drop in iPhone sales to $ 26.44 billion – less than the $ 28.08 billion that FactSet surveyed – down from $ 33.36 billion in the same period last year, which also saw some new models sold .
Sales of iPads increased from $ 4.66 billion to $ 6.8 billion, while sales of Macs rose from $ 6.99 billion to $ 9.03 billion. Apple's latest entry-level iPad became available in late September. Analysts polled by FactSet found iPad sales of $ 6.02 billion and Mac sales of $ 7.82 billion.
Read: The 5G iPhone is restarting the Subsidy Wars, which is good for Apple and consumers, but not for cellular operators
Apple's sales of wearables, household and accessories products rose to $ 7.88 billion from $ 6.52 billion in the year-ago quarter, up on estimates of $ 7.17 billion. Service revenue rose from $ 12.51 billion to $ 14.55 billion, while analysts called for $ 14.11 billion.
Apple's total revenue was a record for the September quarter. The company said in its press release that services and Mac revenue were "reaching new all-time highs".
The smartphone giant declared a dividend of $ 0.205 per share due to be paid to shareholders of record on November 12 at the close of business on November 9th.
Apple stocks are up 59% so far this year, as has the Dow Jones Industrial Average
Of these, Apple is one component that has declined around 6%.