Apple Inc on Thursday reported revenue and profit that topped Wall Street targets, one of the few bright spots in a tech sector that has been hit by inflation-driven spending cuts.
The forecast for the holiday quarter was more dire. Without providing specific figures, Apple said revenue growth would slow to less than eight per cent in the December quarter but not as much as Amazon.com, whose severe holidays sent its shares down 14pc.
Apple shares initially dipped in after-hours trading but rebounded into positive territory.
The Cupertino, California-based tech giant was saved by its oldest technology, its laptop computers, while its star, the iPhone, stumbled.
While iPhone sales weren’t as strong as some analysts had targeted, they were still a record for the September quarter. Mac sales of $11.5bn were well ahead of analyst estimates of $9.36bn.
Apple’s results showed some resilience in the face of a weak economy and a strong U.S. dollar that has led to disastrous reports from many tech companies. Like Facebook’s parent Meta and Snap, Apple is also seeing ad spending soften.
Overall, Apple said quarterly revenue rose 8pc to $90.1bn, beating estimates of $88.9bn, and net profit was $1.29 per share, compared to an average of $1.27 per share, according to data from Refinitiv. topped analyst estimates.
“We performed better than we expected, despite the fact that foreign exchange was a significant negative for us,” Chief Financial Officer Luca Maestri said.
A rising U.S. dollar has hit many companies like Apple that generate substantial foreign revenue and are getting less cash back when they convert it. For consumers, this increases the cost of new devices when purchased in countries outside the US.
Apple’s iPhone sales rose to $42.6bn in the company’s fiscal fourth quarter, when Wall Street expected sales of $43.21bn, according to Refinitiv IBES.
Maestri said iPhone sales set a record for the September quarter, up 10pc from the year-ago quarter and above the company’s forecast.
“The iPhone numbers are an indication of turmoil and uncertainty in the market, but Apple has different ways of dealing with that,” said Runar Bjorhovde, a research analyst at market research firm Canalys.
The introduction of the redesigned MacBook Air and MacBook Pro laptops this summer boosted sales of Apple’s Mac computers. New tablets sold this week.
Apple said its gross margin of 43.3pc was a record for the September quarter. Maestri said the strong computer sales also reflected a backlog of orders, due to a prolonged shutdown at one of the factories that make the Macs, which Apple was able to fill in the quarter.
The company said sales of iPads were $7.2bn, compared to the average estimate of $7.94bn.
Apple’s wearables such as AirPods and other accessories generated sales of $9.7bn, slightly ahead of Wall Street’s forecast of $9.2bn.
“They said they didn’t have a significant problem with supply, so it looks like it’s a thing of the past,” said Carolina Milanesi, consumer analyst at Creative Strategies.
Growth in the company’s services business, which has boosted sales and profits in recent years, saw revenue rise to $19.2bn, missing estimates of $20.1bn.
Maestri said Apple experienced a slowdown in digital advertising and gaming, as have others in the sector. “Like other big tech companies, Apple is suffering from the negative effects of a worsening macro backdrop and ongoing supply chain woes, though it has done a better job of weathering the challenging environment,” Jesse Cohen, of Investing.com. Senior Analyst. , said.
In China, which has experienced an economic slowdown, Apple reported fourth-quarter sales of $15.5 billion. That’s a gain from the previous quarter when Apple posted sales of $14.6bn.
Apple said it now has 900m paying customers for its services, up from 860m last quarter.
