Crisis mood at Apple? This is how it went in the last business quarter

So far, Apple has been able to defy consumer reluctance, mainly thanks to the power of the iPhone: In the last quarter, the group increased revenue by 8 percent year-over-year to $90.1 billion. The bottom line is that profits improved from 20.55 to 20.72 billion dollars, Apple announced on Thursday after the US stock market closed.

what went well

the iphone was a key driver of the company, growing revenue from $38.9 billion to $42.6 billion. As usual, Apple launched the new iPhone generation in September – but this time a week earlier than 2021.

The deal with Mac computers grew from $9.2 billion to $11.5 billion in a rapidly shrinking PC market. However, with the iPad, sales fell from 8.25 to just under $7.2 billion in its fourth business quarter, which ended at the end of September.

Services such as music and video streaming raised $19.2 billion. However, that was relatively much less than the forecast of nearly $20 billion.

the segment Wearables, Home and Accessories The company, which owns the Apple Watch, AirPods, Apple TV set-top box, HomePod, Beats headphones and other accessories, also saw momentum in the past quarter. Apple earned $9.65 billion from these products and exceeded expectations.

Also successful in Europe

In key European markets such as Germany, where Apple recently increased prices for new iPhone models, in some cases sharply given the weak euro, quarterly sales grew from $20.8 billion to $22.8 billion.

What does the Apple leadership say?

During a conference call with analysts, Apple’s CFO Luca Maestri said about half of Mac and iPad buyers are new to the platform. He also announced a record high (though unspecified) for the number of active devices. CEO Tim Cook added that despite the supply shortage for the iPhone 14 Pro and 14 Pro Max, iPhone sales are strong.

Apple is “going through increasingly difficult financial situations,” the Apple chief admitted during Thursday night’s conference call.

“We are still living in unprecedented times,” said the Apple boss. “The world is still unpredictable.”

Cook went on to say that a shortage of chips was no longer a factor this quarter — an issue the company has struggled with in the past.

What’s next?

While Apple managed to grow both revenue and profits in a summer quarter when most US tech companies faltered, that doesn’t necessarily mean the iPhone maker can weather an impending global economic recession.

One analyst noted:

It is feared that the crisis mood will depress consumer spending in the important Christmas market. If financial pressures continue, it could lead to more households cutting back on spending, especially on expensive devices known to be Apple’s cornerstones.

Unlike its competitors, Apple has so far avoided mass layoffs. But it plans to cut spending by 2023 and slow down hiring.

Wall Street didn’t seem to like the company’s numbers: Apple shares fell slightly in after-hours trading after the price initially plunged to five percent in an initial reaction to the numbers.

sources

(dsc/sda/dpa)