Earnings Confirm Apple Was Right About iPhone X All Along

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Earnings Confirm Apple Was Right About iPhone X All Along

Cook was speaking on the sidelines of Apple's earnings call for the second quarter of 2018 on Tuesday. He noted that top seller status has been true in the US every week since the iPhone X launch, and was true in greater China during the quarter ending last month.

Other analysts agreed. "Even if smartphone replacement cycles continue to lengthen, we see Apple delivering 4% revenue and 16% (earnings per share) growth over the next three years with services the primary growth engine", Morgan Stanley's Huberty wrote.

Apple's quarterly results topped Wall Street forecasts, which dropped ahead of the report on growing concern over the iPhone. The company exceeded analyst expectations in per-share earnings and revenues, lifting shares in after-hours trading. Revenue climbed 16 percent to $61 billion. It was in line with Apple's guidance of revenue between $60 billion and $62 billion.

An Apple Music subscription costs $10 per month (€9.99 in Ireland), and the number of paying users recently hit 40 million.

Sales of the iPad were also up slightly in terms of units sold and on revenue, continuing a modest resurgence of the company's tablet business.

Overall profits in the quarter were $13.8bn, up a quarter from the same period in 2017.

Wall Street had predicted that Apple would report earnings per share of $2.69 but the company announced an EPS of $2.73.

When it comes to Apple's iPhone X sales, Wall Street got it wrong

The company, flush with a huge cash pile on strong earnings boosted by the United States tax cut plan of 2017, also announced a 16% boost to its quarterly dividend. The CEO attributed much of the growth to widespread adoption of Apple Pay in Japan, and transit initiatives launched in the Chinese cities of Beijing and Shanghai. Revenue from services surged 31pc to a record $9.2bn.

The performance has been fantastic for Apple in the Indian market after the reports reflected a 20% rise in revenue, while the strongest stays in Greater China region where the growth rate of 21% year-on-year is seen, in the last 10 quarters.

Apple's "other products" segment, which includes AirPods headphones, the Apple Watch, Apple TV and the HomePod smart speaker, posted strong growth with revenue rising 38% to $3.95 billion.

The $22.8 billion that Apple Inc. showered on shareholders in the form of buybacks from January through March is a record, according to a tally by Standard & Poor's. Apple reassured on iPhone sales growth, which registered the fastest increase since 2015, at 14%. Despite most reports predicting otherwise, the iPhone X was the star of the entire show thanks to its impressive sales run.

Average price of iPhones sold in India has consistently been up in the last one year. It's a strong proof that Apple was right all along about its $1,000 phone. What seems more likely is that Apple had hoped for iPhone sales - especially iPhone X sales - to be higher than they were, and was forced to actually scale back orders. But Apple firmly believed that it could still sell a ridiculously expensive phone by offering an entirely new design and innovative features such as Face ID and Animoji.

The iPhone ASP in December quarter was $796, but it came down to $728 in the latest quarter.

Apple has been seen as vulnerable to in the wake of intensifying rhetoric and threats between Washington and Beijing that have raised worries of a trade war.

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