Apple Reports iPhone Sales Fall Due to Late Launch

Apple Reports iPhone Sales Fall Due to Late Launch

The late launch of the new 5G phones caused Apple customers to postpone purchasing new devices, prompting the company to report the steepest quarterly drop in iPhone sales in two years on Thursday.

Apple It fell more than 5 percent at a time of after-hours trading, wiping $ 100 billion (roughly Rs. 7.45.3 billion rupees) from its stock market value.

Since 2013, Apple has delivered new iPhone models every September like clockwork. But pandemic-induced delays delayed the announcement by a month, with some devices yet to ship.

Even when booming sales of Mac products and AirPods Boosted overall revenue and earnings above analysts expected, iPhone sales fell 20.7 percent to $ 26.4 billion (roughly Rs. 1.96,759 crore).

Investors anticipated lower sales of the Cupertino, California-based company’s best-selling product, but retention was worse than expected, especially in China, where more consumers have access to 5G than in the United States or Europe.

Apple has mostly exceeded sales expectations this year, releasing a host of new products and services that its customers adopted while homebound during the pandemic.

Apple said that revenue and earnings for the fiscal fourth quarter ending September 26 were $ 64.7 billion (approximately Rs. 4.82,209 crore) and 73 cents (approximately Rs. 50) per share, in compared to analyst estimates of $ 63.7 billion (roughly Rs. 4). , 74,756 crore) and 70 cents (approximately 50 rupees) per share, according to IBES data from Refinitiv.

But the flagship iPhone 12 The announcement was delayed until October 13, several weeks later than usual, which means that iPhone sales during the opening weekend are not included in the fourth quarter results.

In an interview with Reuters, Apple CEO Tim cook He said he was “bullish” about the iPhone 12 cycle based on the first five days of shipping data.

“5G is a once in a decade opportunity. And we couldn’t be more excited to hit the market exactly when we did,” Cook said. “At least in the United States, operators are being very aggressive.”

The timing of the iPhone 12 launch reduced sales in Greater China by 28.5 percent to $ 7.95 billion (roughly Rs. 59,310 crore). Cook said he hopes the new 5G devices will help China iPhone sales rebound.

“What we are seeing in the early stages of the first five days gives us a lot of confidence that China will grow again in our first fiscal quarter,” Cook told Reuters.

Apple did not provide a revenue growth forecast, but CFO Luca Maestri said that revenue from non-iPhone products and services will grow by double-digit percentages in the first fiscal quarter, in line with the expectations of the companies. analysts. He said iPhone revenue would grow as well, implying that the rate would be in the single digits. Analysts expect iPhone revenue to rise 6.45 percent to $ 59.56 billion (roughly Rs. 4.44.347 crore) in the first quarter, according to Refinitiv data.

Logan Purk, an analyst at Edward Jones, said that “although iPhone sales will grow in this cycle, it will be disappointing compared to the lofty expectations as we do not believe that 5G presents a compelling reason for a wave of updates.”

Apple has offset volatile iPhone sales in recent years with steady growth in its services segment, which includes streaming music and television. Service revenue increased 16.3 percent to $ 14.5 billion (approximately Rs. 1.08.170 million rupees), compared to analysts’ estimates of $ 14 billion (approximately Rs. 1.04.440 million rupees). Cook told Reuters that Apple one, a bundle of payment services from Apple, will launch on Friday.

Cook told Reuters that Apple has 585 million paying subscribers on its platforms, up from 550 million the previous quarter and closer to the goal of 600 million subscribers the company set for the end of the 2020 calendar.

Shares of Apple have skyrocketed in the last two years as it has diversified its sources of income to lessen its dependence on the iPhone. Thursday’s stock slump raises the question of whether Apple is still more reliant on iPhone sales than some investors expected.

“Apple needs to be able to maintain the refresh cycle or the stock price will falter because there is no real room for forgiveness in the current valuation,” said Sophie Lund-Yates, equity analyst at Hargreaves Lansdown.

Apple said its accessories segment revenue rose 20.8 percent to $ 7.9 billion (roughly Rs. 58,934 crore), compared with analysts’ estimates of an increase of 13.5 per cent. cent to $ 7.4 billion (roughly Rs. 55,204 crore), according to Refinitiv data. Mac and iPad Sales increased to $ 9 billion (approximately Rs. 67,140 million rupees) and $ 6.8 billion (approximately Rs. 50,733 million rupees), compared to estimates of $ 7.92 billion (approximately Rs. 59,089 crore) and $ 6.12 billion (approximately Rs. 45,659 crore), according to Refinitiv data.

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