Apple Inc (NASDAQ:AAPL) stock rose 4.65% (As on May 5, 11:23:44 AM UTC-4, Source: Google Finance) after the company reported quarterly revenue and profit above Wall Street’s expectations, with iPhone sales rising and wearables sales slipping less than analysts had feared despite a continuing slump in the consumer electronics market and a cloudy economic outlook. Apple’s China regional business, which includes the mainland, Taiwan and Hong Kong, reported $17.81 billion in sales, down from last year’s $18.34 billion. Analysts had hoped that China’s demand for electronics would rise in the quarter as the company exits out of Covid-era lockdowns and other restrictions. Apple’s iPhone sales grew by 1.5 percent year-on-year, even as the broader smartphone industry saw a decline of 15 percent. The sales increase also put to rest some supply chain issues that hampered production, including an iPhone factory shutdown in late-2022.
Moreover, iPhone and services were the only two business for Apple that grew year-on-year. Sales of the Mac and iPad were worse than what the company had warned earlier, partially due to shortage of parts. Mac sales were also impacted due to a high base.
AAPL in the second quarter of FY 23 has reported the adjusted earnings per share of $1.52, beating the analysts’ estimates for the adjusted earnings per share of $1.43, according to Refinitiv data. The company had reported 2.5 percent fall in the adjusted revenue to $94.84 billion in the second quarter of FY 23, beating the analysts’ estimates for revenue of $93 billion. The overall sales would be higher in constant currency terms, pointing to record quarterly sales in Emerging markets like Mexico, Indonesia, the Philippines, Saudi Arabia, Turkey and the United Arab Emirates.
Apple’s board authorised a $90 billion share buyback and also raised its dividend by 4 percent to $0.24 per share. The company has declared a cash dividend of $0.24 per share of the Company’s common stock, an increase of 4 percent. The dividend is payable on May 18, 2023 to shareholders of record as of the close of business on May 15, 2023.
For the current quarter, Apple expects sales to drop by a similar quantum of around 3 percent, provided macroeconomic conditions do not worsen from what they currently are. In case that happens, it would mark a third straight quarterly sales drop for the company.
On the other hand, the company has announced 20 new titles launching on Apple Arcade, Apple’s game subscription service that offers unlimited access to over 200 incredibly fun games.