Jaromir Miko Today, Apple announced financial results for the fourth and final quarter of last year. The company has reason to celebrate again this time, sales in the Christmas period reached a record 91,8 billion dollars and recorded an increase of 9 percent. Investors can also look forward to earnings of $4,99 per share, up 19%. The company also reported that 61% of all sales came from sales outside the US.
“We are thrilled to report our highest quarterly revenue ever, driven by strong demand for the iPhone 11 and iPhone 11 Pro models, and record results for Services and Wearables. Our user base grew in all parts of the world during the Christmas quarter and today exceeds 1,5 billion devices. We see this as a strong testament to the satisfaction, engagement and loyalty of our customers, as well as a strong driver for the growth of our company." said Apple CEO Tim Cook.
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The company's chief financial officer, Luca Maestri, said the company did well in the quarter, reporting net income of $22,2 billion and operating cash flow of $30,5 billion. The company also paid out nearly $25 billion to investors, including $20 billion in share buybacks and $3,5 billion in dividends.
For the ongoing first quarter of 2020, Apple expects revenue of $63 billion to $67 billion, gross margin of 38 to 39 percent, operating expenses in the range of $9,6 billion to $9,7 billion, other income or expenses of $250 million, and a tax rate of approximately 16,5%. Apple also published the sales of individual product categories. However, the company no longer reports what the sales were because it does not attach much importance to this data.
- iPhone: $55,96 billion versus $51,98 billion in 2018
- Mac: $7,16 billion versus $7,42 billion in 2018
- iPad: $5,98 billion versus $6,73 billion in 2018
- Wearable and home electronics, accessories: $10,01 billion versus $7,31 billion in 2018
- Services: $12,72 billion versus $10,88 billion in 2018
So, as expected, while Mac and iPad sales have declined, the new generation of iPhones, AirPods explosion and the growing popularity of services including Apple Music and others saw record numbers. The wearables and accessories category also surpassed Mac sales for the first time, with up to 75% of Apple Watch sales coming from new users, according to Tim Cook. The value of the company's shares also rose by 2% after the stock market closed.
During a conference call with investors, Apple announced some interesting details. AirPods and the Apple Watch were popular Christmas gifts, making the category worth some Fortune 150 companies. US customers can participate in studies focused on women's health, heart and motion, and hearing.
Apple's services also saw a huge year-on-year increase of up to 120 million, thanks to which the company now has a total of 480 million active subscriptions to services. Apple therefore increased the target value for the end of the year from 500 to 600 million. Third-party services grew by 40% year-over-year, Apple Music and iCloud set new records, and AppleCare warranty service also did well.
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Tim Cook also announced news regarding the coronavirus. The company limits the transportation of employees to China only in cases where it is critically important for the business. The situation is currently unpredictable and the company is only gradually getting information about the seriousness of the problem.
The company has several suppliers even in the closed city of Wuhan, but the company has ensured that each supplier has several alternative subcontractors who could replace it in case of problems. The bigger problem is the extension of the Chinese New Year celebrations and the associated time off. The company also confirmed the closure of one Apple Store, reduced opening hours for others and increased hygiene requirements.
Regarding the use of 5G technology in Apple products, Tim Cook refused to comment on the company's future plans. But he adds that the development of 5G infrastructure is only in the early stages. In other words, it's still early days for a 5G-enabled iPhone.
