• ABOUT
  • CONTACT
Air Herald
Air Herald
  • People & World
  • Pulse
  • Economy
  • Politics
  • Health
  • News
  • Basic

Breaking News

New medical breakthrough could aid lung cancer patients
Iran started injecting uranium gas into more than 1.000 centrifuges this midnight
Get Free Solar System Quotes in Kern County, California
Activist involved in anti-government protests in Hong Kong has been shot by police during a clash
Ultra Keto Slim Australia – Major Discounts on the top Weight Loss Keto Supplement
Apple revenue and profits are down as iPhone sales take a hit, but Apple services are flourishing

Economy

Apple revenue and profits are down as iPhone sales take a hit, but Apple services are flourishing

Hossein Karami apple, Apple services, iCloud, iPhone, iPhone sales, revenue January 30, 2019

Below-consensus forecast was still better than the analysts had warned and predictions are still positive, as Apple posts its sharp decline in revenue for its holiday quarter. The news doesn’t come as a surprise though.

Apple reports a shrink in profits and revenue for the iPhone

Apple has reported a decline in both revenue and profits in its latest quarterly financial results, as the company feels some pain from slowing demand for its star product, the iPhone.

The results showed a 15% fall in sales of the iPhone in the three months ending to December 29th, diving from 61.1 billion $ in 2017, down to 51.9 billion $ a year later.

Mac, iPad and the Wearables, Home and Accessories category all experienced an increase in net sales, but the most notable growth came from Apple’s services – which includes its Apple Music streaming platform, the App Store, iCloud storage and Apple Pay – jumping 19%, from 9.1 billion $ to 10.9 billion $ year-on-year.

During these past days of January 2019, the company issued a weaker-than-expected sales forecast for the current quarter, suggesting that the slowdown in iPhone sales might be leading to some great declines revenue wise.

Analysts already expected small revenue declines for every quarter of the current fiscal year before Apple had issued its March-quarter outlook on Tuesday (29th of January 2019), calling for revenue of 55 billion $ to 59 billion $ for the quarter, compared with the FactSet consensus of about 59 billion $ and the previous year’s total of $61.1 billion.

The surprising outcome was in the stock department where, even though nobody had expected it after this sales decline, it seems that Apple stock rose more than 5% in after-hours trading, leaving one question: how could that happen?

Analyst Daniel Ives of Wedbush cited three reasons during a telephone conversation Tuesday afternoon, starting with the revenue forecast. While it came in below analysts’ consensus expectations, Ives said it was still higher than the market had feared it to be.

The initial fear was that it could even go below the 55 billion $ mark.

The other two factors both had to do with Apple’s services business, which the company has stressed as iPhone sales have stagnated.

As we mentioned earlier, while iPhone revenue declined 15% from the last holiday-shopping quarter, software and services revenue increased more than 19% after normalizing for a change in revenue-recognition rules. Ives pointed to two specific services disclosures from Apple: the gross profit margin and the number of users paying for subscriptions.

Apple services were the ones saving its revenue

Gross margin for the services business was the peace offering Apple offered while taking away unit sales of specific products like the iPhone, trading out a metric that would not look good for Apple for one that does. Apple said that its gross margin for services like Apple Music, iCloud and Apple Pay was 63% in the quarter, which Ives said was better than expected.

“The line in the sand was 60% gross margins,” said the analyst, who has an outperform rating on Apple shares with a 200 $ price target. “The services business may have been something the investors were underestimating in terms of just how profitable it is.”

Ives compared it to Amazon.com Inc. breaking out the performance of its cloud-computing division, which also offered a peek at a higher-margin business that was being diluted by a much larger core business with lower margins.

“When Amazon broke out AWS margins, that was a defining period for Amazon, because investors then started to give them more credit,” he said.

1,939

Related Posts

US job growth likely slowed in August, but gains are enough to support the economy

Economy /

US job growth likely slowed in August, but gains are enough to support the economy

Huawei CEO says China shouldn’t punish Apple

Economy /

Huawei CEO says China shouldn’t punish Apple

Avon May Be Selling To Brazilian Cosmetics Group Natura

Economy /

Avon May Be Selling To Brazilian Cosmetics Group Natura

Crypto CEO dies holding the only passwords that could unlock millions of coins

Economy /

Crypto CEO dies holding the only passwords that could unlock millions of coins

How do you know a company’s culture fits your needs and personality?

Economy /

How do you know a company’s culture fits your needs and personality?

Tesla Cuts Jobs In Order To Make More Affordable Electric Cars

Economy /

Tesla Cuts Jobs In Order To Make More Affordable Electric Cars

‹ Juan Guaidó declared himself Venezuela’s interim president › Medical effects of extremely low temperatures: why they hurt and how do we prevent the damage?

Recent Posts

  • New medical breakthrough could aid lung cancer patientsNew medical breakthrough could aid lung cancer patients
    November 11, 2022
  • Iran started injecting uranium gas into more than 1.000 centrifuges this midnightIran started injecting uranium gas into more than 1.000 centrifuges this midnight
    November 7, 2019
  • Get Free Solar System Quotes in Kern County, CaliforniaGet Free Solar System Quotes in Kern County, California
    October 15, 2019
  • Activist involved in anti-government protests in Hong Kong has been shot by police during a clashActivist involved in anti-government protests in Hong Kong has been shot by police during a clash
    October 2, 2019
  • Ultra Keto Slim Australia – Major Discounts on the top Weight Loss Keto SupplementUltra Keto Slim Australia – Major Discounts on the top Weight Loss Keto Supplement
    September 27, 2019
  • Former French president, Jacques Chirac, dies at 86Former French president, Jacques Chirac, dies at 86
    September 27, 2019
  • Celebrity chef and restaurateur, Carl Ruiz, dies at 44Celebrity chef and restaurateur, Carl Ruiz, dies at 44
    September 23, 2019
  • Trump says he knows how to cut San Francisco’s homeless population in half, but California doesn’t see the same solutionsTrump says he knows how to cut San Francisco’s homeless population in half, but California doesn’t see the same solutions
    September 18, 2019
  • Kenya is the 3rd African country that outs out new malaria vaccineKenya is the 3rd African country that outs out new malaria vaccine
    September 16, 2019
  • US job growth likely slowed in August, but gains are enough to support the economyUS job growth likely slowed in August, but gains are enough to support the economy
    September 9, 2019

Categories

  • Advertorial
  • Basic
  • Economy
  • Health
  • News
  • People & World
  • Politics
  • Pulse
January 2023
M T W T F S S
 1
2345678
9101112131415
16171819202122
23242526272829
3031  
« Nov    

Back to Top

  • Cookies Policy
  • Privacy Policy
  • Terms and Conditions
  • CONTACT
© Air Herald 2020
https://smartprices.online/