Apple sold almost 10 million iPads during the quarter, marking a 9 percent year-over-year drop, but iPad revenues increased 7 percent to $4.9 billion.
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The results, and Apple’s expectations for the current quarter ending September, were better than what Wall Street feared, and the stock rose more than 6% in after-hours trading. However, this number exceeded analyst expectations, which averaged 39.9 million.
The iPhone SE, Apple’s first 4-inch smartphone since 2013, was launched in March as a lower cost alternative to their flagship 6s and 6s Plus.
Meanwhile, chief financial officer Luca Maestri explained Apple’s performance had topped his expectations in a quarter weighed down by tough foreign exchange rates and hard comparisons with blockbuster iPhone 6 sales from the previous year.
Revenue in the Greater China region, a market CEO Tim Cook has said will be Apple’s biggest someday, was $8.8 billion in the June quarter, a drop of 29 percent over last quarter and 33 percent over this time a year ago.
Both the iPad Pro and iPhone SE took center stage in the report, as Apple touted both of the recent launches as having a notable impact in overall sales. These results compare to revenue of $49.6 billion and net income of $10.7 billion, in the year-ago quarter. “In the first three quarters of this fiscal year, iPhone sales in India were up 51 percent year on year”.
Apple said it had carried out a cut of $3.6 billion in distributors’ inventory of the smartphones, up from the $2 billion mentioned in its previous earnings report.
“We think services will continue to grow very briskly”, Mr Cook said. Such services emerged as Apple’s second-largest business after the iPhone for the first time in the company’s second quarter, eclipsing gadgets such as the iPad and the Mac. There are also claims that the company may not even use the “iPhone 7” term.
The shift is good news for the firm because it allows it to make more money from its existing users.
That’s huge. With the days of endless hardware growth now over, such a huge leap in the services division will be essential for Apple’s future.
Figures released today show that sales in China fell 33.1 percent, compared with a 112.4 percent rise in the same quarter a year ago.
In addition to cooling demand in China, Apple is also facing aggressive completion from local manufacturers, including Huawei Technologies Co., which has started gaining traction in the global smartphone market.
Apple said its gross margin was 38% in the latest quarter, in line with its estimated range of 37.5% to 38%.
Apple said that revenue from services grew 19 percent, driven by cash from App Store downloads and rising subscriptions at its stumbling Apple Music division.
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Apple Inc sold 40.4 million iPhones in the last quarter, the California based company announced on Tuesday after USA stock markets had closed.
