Apple 2Q18 earnings match forecasts, iPhone X dubbed a winner
“Customers chose iPhone X more than any other iPhone each week in the March quarter, just as they did following its launch in the December quarter.”
Apple CEO Tim Cook puffs his chest on iPhone X sales after supply chain indicators and analysts pointed to poorer numbers during the winter season. The company logged second-quarter revenue of $61.1 billion, up 16 percent from a year ago and beating market consensus marginally. That converted to net income of $13.8 billion, a 25 percent improvement.
Breaking down products, the company shipped 52.2 million iPhones (again, nearly matching forecasts) with an average sales price of $728.35 per unit. Apple does not give out specific numbers per model citing a protection of competitive advantage, but if Cook’s claim that the iPhone X outperformed all other models is true, keep in mind that the ASP is up $73 from last year, but still $13 below forecasts.
iPad sales ticked up 2 percent to 9.11 million units and Mac sales slid 3 percent to 4.08 million units. Service revenue picked up 31 percent from last winter to $9.19 billion, thoroughly thrashing the $8.3 billion expected on the street. Other revenue, which includes products like the Apple Watch, also rocketed up 38 percent to $3.95 billion.
Apple is allotting $100 billion to buy back shares this year and bumped up the quarterly dividend by 16 percent. The company is trying to eat away at “excess cash,” though it’s still trying to cut down on reserves of $145 billion after debt.
CFO Luca Maestri told Reuters that the company is also against a tariffs war between the US and China, especially when components, labor and final products that Apple relies on travels across the Pacific on a constant basis. The iPhone X is a top-seller in China, the company’s second-largest market.
The company is forecasting revenue for the current quarter to land between $51.5 billion and $53.5 billion with a gross margin of around 38 percent.