Apple falls just shy of expectations with $52.9B in revenue, iPhone sales dip again to 50....
Apple on Tuesday revealed the results of its second quarter of fiscal year 2017, earning $52.9 billion in revenue and posting year-over-year growth, but once again saw iPhone sales shrink from the same period a year ago.
Apple shipped 50.8 million iPhones in the March quarter, which was down from the 51.2 million the company shipped in the second quarter of fiscal 2016. That means the iPhone's return to growth under the iPhone 7 series was short-lived, lasting just the holiday 2016 quarter.
Still, there were bright spots in Apple's results, including slightly higher-than-expected profits that resulted in earnings per share of $2.10. In general, Wall Street was expecting $53.1 billion in sales and $2.02 earnings per share.
Though iPhone units were down just shy of 1 percent, revenue was actually up slightly, reflecting higher sales of the premium-priced iPhone 7 Plus. And its Services business (revenue up 18 percent year over year) and "Other Products" category -- including the Apple Watch, AirPods and Beats hardware (up 31 percent) -- were bright spots for the company.
Rounding out the rest of Apple's major hardware categories, iPad sales were 8.9 million units, another year-over-year decline, while the Mac sold 4.2 million, up from 4 million a year ago. Mac sales price increases also outpaced sales growth, with revenue growing 14 percent year over year.
"We are proud to report a strong March quarter, with revenue growth accelerating from the December quarter and continued robust demand for iPhone 7 Plus," said Apple Chief Executive Tim Cook. "We've seen great customer response to both models of the new iPhone 7 (PRODUCT)RED Special Edition and we're thrilled with the strong momentum of our Services business, with our highest revenue ever for a 13-week quarter. Looking ahead, we are excited to welcome attendees from around the world to our annual Worldwide Developers Conference next month in San Jose."
Apple also announced that its board of directors has authorized an increase of $50 billion to the company's program to return capital to shareholders. It is also extending the program timeframe by four quarters. Under the newly expanded program, Apple plans to spend a cumulative total of $300 billion by the end of March 2019.
Accordingly, Apple's board increased its share repurchase authorization to $210 billion from the $175 billion level announced a year ago. The company also expects to continue to net-share-settle vesting restricted stock units.
The dividend will increase by 10.5 percent to $0.63 per share, payable on May 18, 2017 to shareholders of record as of the close of business on May 15.
Apple has returned over $211 billion to shareholders, including $151 billion in share repurchases.
"We generated strong operating cash flow of $12.5 billion and returned over $10 billion to our investors in the March quarter," said Apple Chief Financial Officer Luca Maestri. "Given the strength of our business and our confidence in our future, we are happy to announce another $50 billion increase to our capital return program today."
Looking forward to the next quarter, Apple's third of fiscal 2017, the company is guiding the following:
Apple shipped 50.8 million iPhones in the March quarter, which was down from the 51.2 million the company shipped in the second quarter of fiscal 2016. That means the iPhone's return to growth under the iPhone 7 series was short-lived, lasting just the holiday 2016 quarter.
Still, there were bright spots in Apple's results, including slightly higher-than-expected profits that resulted in earnings per share of $2.10. In general, Wall Street was expecting $53.1 billion in sales and $2.02 earnings per share.
Though iPhone units were down just shy of 1 percent, revenue was actually up slightly, reflecting higher sales of the premium-priced iPhone 7 Plus. And its Services business (revenue up 18 percent year over year) and "Other Products" category -- including the Apple Watch, AirPods and Beats hardware (up 31 percent) -- were bright spots for the company.
Rounding out the rest of Apple's major hardware categories, iPad sales were 8.9 million units, another year-over-year decline, while the Mac sold 4.2 million, up from 4 million a year ago. Mac sales price increases also outpaced sales growth, with revenue growing 14 percent year over year.
"We are proud to report a strong March quarter, with revenue growth accelerating from the December quarter and continued robust demand for iPhone 7 Plus," said Apple Chief Executive Tim Cook. "We've seen great customer response to both models of the new iPhone 7 (PRODUCT)RED Special Edition and we're thrilled with the strong momentum of our Services business, with our highest revenue ever for a 13-week quarter. Looking ahead, we are excited to welcome attendees from around the world to our annual Worldwide Developers Conference next month in San Jose."
Apple also announced that its board of directors has authorized an increase of $50 billion to the company's program to return capital to shareholders. It is also extending the program timeframe by four quarters. Under the newly expanded program, Apple plans to spend a cumulative total of $300 billion by the end of March 2019.
Accordingly, Apple's board increased its share repurchase authorization to $210 billion from the $175 billion level announced a year ago. The company also expects to continue to net-share-settle vesting restricted stock units.
The dividend will increase by 10.5 percent to $0.63 per share, payable on May 18, 2017 to shareholders of record as of the close of business on May 15.
Apple has returned over $211 billion to shareholders, including $151 billion in share repurchases.
"We generated strong operating cash flow of $12.5 billion and returned over $10 billion to our investors in the March quarter," said Apple Chief Financial Officer Luca Maestri. "Given the strength of our business and our confidence in our future, we are happy to announce another $50 billion increase to our capital return program today."
Looking forward to the next quarter, Apple's third of fiscal 2017, the company is guiding the following:
- revenue between $43.5 billion and $45.5 billion
- gross margin between 37.5 percent and 38.5 percent
- operating expenses between $6.6 billion and $6.7 billion
- other income/(expense) of $450 million
- tax rate of 25.5 percent
Comments
Touch bar MacBook Pro obviously.
No they want iPhone to sell 80 million a quarter and everything else to sell 100 million a quarter. It's ridiculous jibber jabber.
2) The previous year's model does go down in price, and lateral move, budget devices with some new and some old tech are reduced in price because the overall component costs are lower, but we need to consider that R&D is at an all time high (not that it's necessary increased with the iPhone) and Apple has moved the bar for making considerably better devices year-over year. How much does the water resistance add, or the altimeter, or the better radios, and much improved SoC that continue to do a lot more processing with less power that the competition still can't touch years later? Then you have the better color gamut and countless other improvements to the iPhone.
My guess is that Apple just updated just some very basic internal components that look good on a spec sheet that they could be able to lower the price and still keep the same profit margins, but they're still pushing the envelope so I don't see that happening. Touch ID, Apple Pay, and 3D Touch would've taken years to work out the HW, SW, and applicable developer tools properly.
Even the Touch Bar on the MBP is said to have taken nearly a decade to work out, which I can believe since those Macs now run dual OS X operations systems—the primary macOS and then a forked version of watchOS running on the T1-chip they built specifically so they could have the Touch Bar with Touch ID and Apple Pay. I suspect the next MBP will drop in price now that the R&D fort he Touch Bar is likely paid for and because the rest of the machine gets "updated" minimally compared to how the iPhone gets updated YoY.
It's 4% growth year over year.
Overall PC Shipment also grew for very first time in 5 years (albeit 0.6%)
HP grew 13% YoY, Dell grew 6.2% YoY.
btw, IDC was right at the mark when one month ago they said Mac will sell 4.2M for this quarter.
https://www.idc.com/getdoc.jsp?containerId=prUS42464617