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Consumer electronics giant Apple (AAPL) saw its steepest sales decline in more than six years in its latest quarter, missing Wall Street's targets for the December quarter. The company reported net income of $22.2 billion and earnings per share of $4.99, down from a year prior.
Revenue for the quarter ended December 28 fell 5% to $84.3 billion, according to a statement released late Thursday, well below analysts' estimates of $86.9 billion. The decline was driven primarily by weaker-than-expected iPhone sales, which were down 9% year-over-year to $51 billion. Mac and iPad sales also fell 7% and 11%, respectively, compared to a year prior.
Production issues in China seemed to impact Apple far more than expected in the holiday quarter, with Chief Executive Officer Tim Cook noting during a conference call with analysts that the company was “experiencing a slower return to normal conditions than we had anticipated."
The news sent Apple shares tumbling 4% in extended trading following the announcement. Prior to the release, the stock had gained 6.3% this year and closed Thursday at $310.33 per share.
Consumer electronics giant Apple (AAPL) had a disappointing quarter, as the company on Thursday reported its steepest sales decline in more than six years.
The iPhone maker reported fiscal first-quarter earnings of $4.25 per share, missing the Wall Street consensus estimate of $4.54 per share. Revenue for the quarter was $84.3 billion, down 5% year over year and below analyst forecasts of $85.5 billion.
Apple's iPhone revenue dropped 15% to $51 billion, with the company saying production issues in China impacted sales more than expected during the holiday quarter. Mac sales were also down 9%, while iPad sales rose 17%.
“While macroeconomic challenges in some markets were a key contributor to this trend, we believe there are other factors broadly impacting our iPhone performance, including consumers adapting to a world with fewer carrier subsidies, U.S. dollar strength-related price increases and some customers taking advantage of significantly reduced pricing for iPhone battery replacements," said Apple CEO Tim Cook in a statement.
Despite the weak quarter, Apple announced that it will increase its dividend by 5%, returning an additional $75 billion to shareholders by the end of March 2021.
“We remain very optimistic about Apple's future, particularly given our strong pipeline of innovative hardware, software and services," Cook said.
Consumer electronics giant Apple (AAPL) reported its fiscal fourth-quarter earnings late Thursday, missing Wall Street's expectations due to declining iPhone and Mac sales. The results show the steepest sales decline in more than 6 years.
Apple reported revenue of $84.3 billion, down 9% from a year ago, and earnings per share of $3.03, down 8%. Analysts had expected revenue of $91.3 billion and EPS of $3.20.
The company attributed the weak performance to production issues in China which impacted Apple far more than expected during the holiday quarter. Revenue from iPhones fell 9% to $55.96 billion, while Mac revenue declined 5%. iPad sales were up 17%, while services rose 17% from a year ago.
The downturn was felt across most of Apple's geographic regions, including in Greater China, which saw a 22% drop in revenue compared to a year ago. CEO Tim Cook said the company is "encouraged by the customer response to our new products and services," citing strong demand for AirPods Pro and wearables such as Apple Watch Series 5 and AirPods.
Apple shares fell nearly 5% in extended trading following the release of its earnings results.