Apple reports solid profits, but iPhone sales miss estimates

Apple reports solid profits, but iPhone sales miss estimates

Apple reported better-than-expected profits but iPhone sales missed estimates
Apple reported better-than-expected profits but iPhone sales missed estimates. Photo: Daniel SLIM / AFP/File
Source: AFP

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Apple reported solid profits on rising revenues Thursday, but the tech giant's iPhone sales missed estimates while it saw slowing growth in services revenues.

Profits edged up one percent to $20.7 billion, on an eight percent rise in revenues to $90.1 billion in Apple's fiscal fourth quarter ending September 24.

Shares edged lower in after-hours trading, a much better response than that of Facebook parent Meta and other tech giants that have plunged after results in recent days.

Those other tech behemoths have upset investors with varying problems ranging from weak online advertising revenue, swelling costs and disappointing forecasts.

By contrast, Apple notched growth in most operating regions and product categories and released an earnings statement that contained no obvious red flags and showed the company still able to notch broad-based revenue growth despite the drag from the strong dollar.

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Results for the latest quarter "continue to demonstrate our ability to execute effectively in spite of a challenging and volatile macroeconomic backdrop," said Apple Chief Financial Officer Luca Maestri.

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"This quarter capped another record-breaking year for Apple, with revenue growing over $28 billion and operating cash flow up $18 billion versus last year."

Still, Apple's smartphone revenues came in at $42.6 billion, a bit below the $43 billion projected by analysts.

The company also notched services revenue growth of just 5.0 percent compared with the year-ago period -- much below the 12 percent jump in the prior quarter.

Heading into earnings season, investors had expressed worries about the headwinds from the weakening global economy as central banks enact aggressive interest rate hikes to counter grinding inflation.

This week's tech results have shown that the sector, which enjoyed outsized growth during the peak period of Covid-19, is not immune to these factors.

Shares of Apple slipped 0.8 percent to $143.71 in after-hours trading.

Source: AFP

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