Strong growth at Apple propels its market valuation close to $1.4 trillion amid buoyant iPhone sales, even in China
Apple has produced a strong performance in its latest financial period in a display that has ‘thrilled’ both investors and the company’s management.
Apple’s financial results revealed it had experienced sales growth across all regions globally (including China), although sales did dip slightly in Japan.
But the strong performance at Apple comes amid worries that the deadly coronavirus outbreak in China could impact production of the iPhone, including the new budget-conscious smartphone which Apple is reportedly hoping will boost sales in emerging markets.
Apple of course benefited from sales during the Christmas holiday period, but it seems that consumers have reacted well to the iPhone 11 range, despite disappointment when it launched in September without any 5G capability.
Looking at Apple’s financials, for the first quarter ending 28 December, it posted a net profit of $22.2bn, up from $19.9bn a year earlier.
There was equally good news on the revenue side, as sales rose to $91.8bn from $84.3bn in the same year-ago quarter.
Of that first quarter figure, $79.1bn was from product sales ($12.7bn was from services).
“We are thrilled to report Apple’s highest quarterly revenue ever, fuelled by strong demand for our iPhone 11 and iPhone 11 Pro models, and all-time records for Services and Wearables,” said Tim Cook, Apple’s CEO.
“During the holiday quarter our active installed base of devices grew in each of our geographic segments and has now reached over 1.5 billion,” said Cook. “We see this as a powerful testament to the satisfaction, engagement and loyalty of our customers – and a great driver of our growth across the board.”
Of the deadly coronavirus outbreak in China, Cook was quoted by Reuters as saying, “We have limited travel to business-critical situations as of last week. The situation is emerging, and we’re still gathering lots of data points and monitoring it very closely.”
Apple apparently has suppliers in the Wuhan area, which is the epicentre of the outbreak, as well as supplier manufacturing facilities in nearby provinces.
Apple has apparently closed one store in China, and reduced hours at others because of lower foot traffi.
Cook was also quoted as saying that third-party stores that sell Apple products are also facing some closures.
Cook was also quoted by Reuters as saying its newly launched Apple TV+ subscription streaming video service was a “rousing success”.
Meanwhile it seems that Apple achieved iPhone sales of $55.96 billion, beating analyst estimates of $51.6 billion.
This has pleased the markets as Apple has reserved a yearlong trend of sales declines for its main money maker.
Cook reportedly said that the iPhone 11 and iPhone 11 Pro models drove the growth and also factored into the company’s forecast, calling the devices “the strongest iPhone lineup we’ve ever had.”
Apple’s wearables segment – which, along with AirPods, also includes the Apple Watch – reportedly hit $10.0 billion in revenue versus estimates of $9.5 billion.
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