Apple reported quarterly earnings that exceeded Wall Street’s expectations, with revenue of $90.8 billion and earnings per share of $1.53, slightly above forecasted numbers. The company saw a 4% decline in sales compared to the previous year’s quarter, with revenues in the greater China region down 8%. However, Apple surpassed expectations with $16.4 billion in sales from China, higher than forecasts of $15.3 billion. The company also announced plans to repurchase $110 billion of its shares and increased its quarterly dividend to $0.25 per share.
The tech giant reported $46 billion in revenue from iPhone sales and $23.9 billion from services, which includes App Store transactions and repairs. The strong performance in these key areas helped boost Apple’s stock price by 5% following the earnings release. Apple’s net income for the quarter was $23.6 billion, making it the most profitable American public company, with earnings nearly $10 billion higher than the next highest-earning S&P 500 company, Microsoft.
Despite its strong earnings, Apple’s stock price has been down 7% year-to-date, underperforming the tech-heavy Nasdaq Composite index. Investors have been concerned about Apple’s negative earnings and sales growth, particularly in iPhone demand in China. Additionally, there are fears about Apple falling behind in the artificial intelligence race compared to other tech giants like Alphabet, Microsoft, and Nvidia, whose earnings have shown the benefits of AI technology. Apple’s challenges have been exacerbated by a global downturn in demand from China, which accounts for a significant portion of its revenues.
Looking ahead, analysts are keeping an eye on any updates from Apple on its generative AI projects, with CEO Tim Cook hinting at more information in 2024. There may be announcements at Apple’s upcoming Worldwide Developers Conference in June. Despite recent setbacks like the cancellation of its car project and a lukewarm reception for its Vision Pro mixed reality headsets, Apple remains a key player in the tech industry, and investors are hopeful for continued innovation and growth from the company.
