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Apple beats estimates, shares to new highs at Wall Street

Apple, Wall Street, Apple earnings, Apple beats estimates

Apple, Wall Street, Apple earnings, Apple beats estimatesApple beats estimates in the fourth quarter: revenues rose to $ 52.6 billion, up 12% YoY, earnings at $ 2.07 a share (+ 24%). In Wall Street, the share closed Friday at $ 172.50, touching a high at $ 174.26, new absolute high for Apple. The result is dragged by all product categories, not just the iPhone, and by yet another leap of the services. Apple also said revenues for the next quarter will be better than analysts' estimates, suggesting that expectations are for a strong demand for iPhone X.

 

Not just iPhone

Apple has sold 47 million iPhones for the past three months, which for a few days includes the new iPhone 8. Compared with a year ago, iPhone revenue growth (over 28 billion) was 2%, but the most interesting data are others. Still run the services, category that includes the app store, iTunes, Apple Music, Apple Pay, AppleCare and licenses: for the first time they reach $ 8.5 billion, up 34% over a year ago. The services are the second item under the iPhone, which now accounts for more than half of the revenue but in the previous quarters, they had a value two thirds. It should be said that with the arrival of the iPhone X the force ratios could change again. 

After the services come Macs, with revenues of 7.17 billion, up 25% year on year, iPads have a value nearly 5 billion and are substantially stable (-3% on the previous quarter, but + 14% over the last year) while the category of other products with 3.2 billion shows a significant growth compared to a year ago: + 36%. This is a result highly respected by analysts because inside this category there are Apple Watch, new Apple TV, Beats headphones.

 

The iPhone X day

The results arrive on the eve of one of the most important days for Apple since the launch of the first iPhone: selling of iPhone X, the model celebrating the decade of smartphone wanted by Steve Jobs who revolutionized the market. For now, it has the most expensive iPhone record: in Europe it costs from € 1,189 (in UK £ 999) with 64GB of storage, topping out at € 1,359 (in UK £ 1,149) with 256GB of storage, which is higher than the starting cost of three of Apple’s fully-fledged computers. The iPhone X marks a rather radical change compared to previous models because it changes the interface: the Home Button disappears, has a display that occupies virtually all frontal surfaces (a trend already consolidated by competitors), has an Oled display.

 

On the road to the 1,000-billion-dollar market cap

Pre-orders started on October 27: there is no official data but delivery times have slipped and reports have talked about a very positive result for Apple, by ensuring that, which after the announcement of new phones on September 12 had fallen for weeks, has updated the absolute highs. The market cap is on the road to achieving the trillion dollars, which would be a primacy. A goal that the company could achieve if the shares reached $ 193-194.

 

Unknown production times

Waiting to see what will be the real sales results, some worry comes from production times. The phone's unlocked facial recognition technology is proving to be more difficult than expected. According to Nikkey Asian Review, initially, the available pieces will be only 20 million in 2017, half as planned for this year. Ming-Chi Kuo of KGI Securities estimates that Apple will have available 25-30 million iPhone X at most for Christmas time. To have a comparison last year Apple sold 78 million iPhones, although the data includes all the models. Analysts are mostly optimistic about the success of the new phone, the variable remains the actual availability.

 

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