Sales pushed by Apple Inc.’s iPhone X brought the quarterly results beyond what Wall Street predicted on Tuesday, July 31st. Helping out their impressive business results were subscription services such as Apple Music and iCloud.
With fall approaching, Apple announced that they expect revenue numbers to bypass all predictions, as well. Apple typically launches new iPhones in the fall, and Apple plans to regain even more growth in China, putting them above the 19 percent they’ve already reclaimed.
The tech giant has ignored the balancing state of the smartphone market by increasing the price of their phones and providing more services such as “wearables.” Tim Cook, the Chief Executive of Apple, has stated that the Apple Watch and wireless AirPods have only contributed to the growth of the business.
Keeping the future in mind, Apple has created a $100 billion stock buyback plan to which they’ve already repurchased $20 billion in stock during this quarter.
Financial analysts are looking at Apple’s management team and seeing that they are capitalizing on the financial rewards that come with selling a pricey smartphone, even if fewer units are sold. Currently, Apple is just flickering near the title of the world’s first trillion-dollar company. The shares rose to $196.80, and the market capitalization is more than $900 billion.
During its third quarter, Apple sold 41.3 million units, and the forecast was 41.8 million units. However, analysts expected the average selling price to be $694 when it was $724, and the $1,000 iPhone X was the top seller of the quarter. Their reported third-quarter revenue was $53.3 billion with profits of $2.34 per share, whereas estimates expected $52.3 billion and $2.18 per share.
Apple is the world’s most valuable and recognized technology company, and they announced an expected revenue intake of between $60-$62 billion for the fourth quarter. Those numbers include any sales that come in from currently unannounced and unreleased iPhone and wearable models.
Regardless of how good things are currently looking for Apple, financial analysts from around the world have stated that investors could grow concerned. There’s only so much growth that Apple can expect from raising the prices of their products.
While some of Apple’s services such as the coveted Apple Care don’t face much competition and have sales that were up nearly 30 percent, other services like music and video streaming have stiff competition with Spotify, Netflix, and other services.
Currently, the Apple Watch is one of Apple’s most significant growth drivers. While it doesn’t face duties because of United States-China trade issues, President Donald Trump has threated future tariffs that could implement the success of the Apple Watch and AirPods.
Financial and business analysts are monitoring Apple’s operating costs, which appear to be increasing with more research and development to meet high-pressure demands. Consumers are pushing for components such as OLED displays for vivid color resolution. Apple has said that their expected operating costs should grow to $8.05 billion.
Analysts had $9.1 billion expectations for Apple’s services revenue when they actually reached $9.5 billion. That revenue also reportedly included $236 million from lawsuits. As of now, all of Apple’s expectations for their fourth-quarter results beat out analyst expectations, but only time can tell.