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Apple continues to fare well amid economic downturn

Apple successfully exceeded Wall Street analysts’ sales and earnings expectations for last month’s quarter, despite a tough earnings season.

Sales in the September quarter overcame fears that demand for the iPhone 14 series was weaker than expected.

Sales

Apple posted sales of more than $90 billion in its fiscal fourth quarter, up 8% from the same period last year.

Earnings also reached $20.7 billion, a gain of less than 1% from the same quarter a year ago.

Apple CFO Luca Maestri released a statement stating:

“Our record September quarter results continue to demonstrate our ability to execute effectively in spite of a challenging and volatile macroeconomic backdrop.”

Following the report, the company’s shares fell more than 1% after-hours trading.

Read also: Apple earnings report shares news on iPhone 14 sales

Apple products

Product sales grew 9% year-over-year to nearly 71 billion.

This indicates a decline in the growth rate from the previous year, but it was not unexpected.

Consumers are currently dealing with high inflation and fears of a possible recession.

Meanwhile, the substantial dollar value still raises questions internationally about Apple’s success in convincing users to upgrade their devices.

Apple CEO Tim Cook said the company hit record September quarter sales for the iPhone in an analyst call.

Services segment

Apple’s services segments reported revenue of $19.2 billion, up 5% from the prior year’s quarter and down from the year-over-year growth rate.

The Services segment includes paid subscriptions for Apple TV+ and Apple Music.

It is seen as a core unit for the company that will offset slower growth in areas of Apple’s hardware business.

According to Maestri, the company has more than 900 million paid service subscriptions.

There were only 155 million paid subscriptions in 2021.

Raised prices

The company raised prices this week for its music and TV streaming services to boost sales.

Investing.com analyst Jesse Cohen released a statement on their decision, saying:

“Like other major tech companies, even Apple is suffering from the negative impact of a worsening macro backdrop and ongoing supply chain woes.”

“Though, it has done a better job of navigating through the challenging environment,” Cohen added.

Luca Maestri says Apple expects a slowdown in year-over-year revenue growth in the December quarter.

He cites the strength of the US dollar and continued macroeconomic weakness as factors slowing growth.

Reference:

Apple is weathering the economic downturn better than fellow tech giants

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