Primetime Partners Chairperson Alan Patricof discusses expectations for the tech giant’s fiscal 2Q results and weighs in on the AI boom on ‘The Claman Countdown.’
Apple’s financial results came in above estimates in both revenue and earnings per share (EPS) as it reported on its second quarter Thursday afternoon.
In the second quarter, the tech generated $94.84 billion in net sales, a 2.5% decline compared to the same three-month period last year.
Refinitiv estimates had put Apple’s second-quarter revenue at $92.96 billion, a figure the iPhone maker topped.
The Apple logo is illuminated at a store. (AP Photo/Matthias Schrader/File / AP Newsroom)
On diluted EPS, Apple also beat expectations. It was $1.52, 9 cents more than estimates and matching last year’s second quarter.
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Results were mixed for the company’s five business segments.
In its iPhone segment, Apple posted $51.33 billion in quarterly net sales, 1.5% higher from 2022 when it reported $50.57 billion. But it was higher than the $48.90 billion anticipated by analysts.
Quarterly net sales for services experienced a 5.5% lift, rising from $19.82 billion to $20.91 billion. Analysts estimated $20.91 billion.
Apple reported generating $7.17 billion in net sales from its Mac segment for the second quarter. Last year, it brought in $10.44 billion during same three-month period.
Apple Inc. has seen its market capitalization surge to nearly $3 trillion. (Bridget Bennett for The Wall Street Journal / The Wall Street Journal)
The company’s iPad and wearables, home and accessories segments brought in $6.67 billion and $8.76 billion in net sales, respectively. The former dropped 12.8% year-over-year, while the latter fell just 0.6%.
Expectations from Refinitiv analysts had been $7.82 billion for Mac, $6.69 billion for iPad and $8.42 billion for wearables, home and accessories.
"We are pleased to report an all-time record in services and a March quarter record for iPhone despite the challenging macroeconomic environment, and to have our installed base of active devices reach an all-time high," CEO Tim Cook was quoted as saying in the earnings release.
The Apple Inc. logo at one of the company’s stores in Sydney, Australia, March 18, 2022. (Brent Lewin/Bloomberg via Getty Images / Getty Images)
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The services segment previously reached an all-time revenue record in the first quarter.
In addition to its quarterly financial results, the iPhone maker revealed Thursday it would do a buyback of "up to $90 billion" shares. It also unveiled a 4% increase in its cash dividend, making it $0.24 per share.
The board decided to do so "given our confidence in Apple’s future and the value we see in our stock," CFO Luca Maestri said in a release.
During the call the tech giant held with analysts and investors to go over earnings, Cook fielded a question about artificial intelligence (AI).
He said Apple doesn’t comment on its product roadmap before adding it was "important to be deliberate and thoughtful in how you approach these things."
He noted there were "a number of issues that need to be sorted as is being talked about in a number of different places," adding that the "potential" is "certainly very interesting."
Apple CEO Tim Cook, center, and Senior Vice President of Retail Deirdre O’Brien wave to the dozens of people waiting outside during the grand opening of Apple’s first flagship store in Mumbai, India, April 18, 2023. (AP Photo/Rafiq Maqbool / AP Newsroom)
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"We’ve obviously made enormous progress integrating AI and machine learning throughout our ecosystem, and we’ve weaved it into products and features for many years," he added. "You can see that in things like fall detection, crash detection, ECG. These things are not only great features but saving people’s lives out there, and so it’s absolutely remarkable.
"We view AI as huge and will continue weaving it in our products on a very thoughtful basis."