Analysts Stunned By Apple’s Quarterly Earnings

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on May 11, 2015
Updated: Oct 10, 2019
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Apple Performs Well Above Expectations!

Apple Capital Returns Boosted

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Apple Inc (AAPL) has performed exceptionally well in Q2 – beating analysts’ forecasts by some margin. During Q2 2015, Apple’s earnings were pegged at $58 billion and per share earnings were $2.33. Many analysts who cover the IT and technology sector expected Apple to post earnings of $56.08 billion and $2.16 p/share. Year on year, Apple improved markedly on its earnings from $1.66 p/share and revenues of $45.6 billion.

These numbers are encouraging to investors who see strong gains for Apple’s share price moving forward. Following on from these figures, Apple announced that capital returns would be boosted by $70 billion to $200 billion. A $140 billion share repurchase authorization marks a $50 billion increase over 2014.  Further, the dividend has been increased to $0.52 p/share – up 11%. According to spokespeople from Apple, the program will run through to March 2017. The buyback is a sign of Apple’s confidence in its profit generation capabilities.

Apple has also substantially increased its cash reserves from $178 billion in Q1 2015 to $193.5 billion in Q2 2015. These figures represent strong growth and solid earnings from the world’s premier tech company. According to Apple, an estimated $171 billion of this figure is offshore.  From Q4, 2012 Apple’s Capital Returned has not dipped below $2.5 billion. The following Capital Returned figures were reported:

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  • 2012 Q4 – $2.5 billion
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  • 2013 Q1 – $5 billion
  • 2013 Q2 – $2.5 billion
  • 2013 Q3 – $19.2 billion
  • 2013 Q4 – $7.8 billion
  • 2014 Q1 – $8.1 billion
  • 2014 Q2 – $20.7 billion
  • 2014 Q3 – $8.3 billion
  • 2014 Q4 – $20.1 billion
  • 2015 Q1 – $8.3 billion
  • 2015 Q2 – $9.8 billion

Apple’s Cash Position in Billions of Dollars was listed as follows:

  • 2012 Q4 – $121 billion
  • 2013 Q1 – $137 billion
  • 2013 Q2 – $145 billion
  • 2013 Q3 – $147 billion
  • 2013 Q4 – $147 billion
  • 2014 Q1 – $159 billion
  • 2014 Q2 – $151 billion
  • 2014 Q3 – $164 billion
  • 2014 Q4 – $155 billion
  • 2015 Q1 – $178 billion
  • 2015 Q2 – $194 billion

The announcements made on Monday the 27th April sent the stock 1% higher after regular hours trading. Banc De Binary analysts believe the rally will continue well into the future. The fundamentals of Apple stock are strong and the company’s earnings potential reflect this bullish sentiment. The driving force behind Apple’s resurgence is its iPhone sales. With a total of 61.17 million units sold, the company beat out expectations of 57.26 million.

Strong demand for iPhone 6 Plus and iPhone 6 drove sales volumes in the last quarter. Additionally, Apple also sold a huge of iPads – although lower than analysts’ forecasts. The actual sales figures amounted to 12.62 million and the forecast figure was 13.94 million. As for Mac units, the sales amounted to 4.6 million and analysts’ expectations were pegged at 4.64 million. Apple CEO Tim Cook was pleased with the performance of his company, lauding annual growth of Mac units especially in view of the slowdown in the global PC industry.

The Apple Watch Lays the Groundwork for Big Sales

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June is going to be an especially good month for Apple since the Apple Watch will be launched. Public feedback on the Apple Watch has generally been positive and there are several thousand apps available for the product. With demand outstripping supply by a long margin, additional markets will be entered into by mid-2015. Profit margins on the Apple Watch and other wearable products will be far lower than the average generated by other products at Apple. Although iPad sales have been slow, they are likely to rebound in coming months. In terms of sales, Apple iPhone spike to its highest level in several years in Q1 2015 at over 60 million. iPad sales in Q1 2015 were a touch over 20 million. Q2 figures dipped for iPhone and iPad sales, but were both high when viewed over the past 2 years.

A big factor that played well into Apple’s profitability was the currency impact. Profitability was hampered as a result of the negative impact of the currency factor. Apple stocks on the leading binary options platform have been performing well, given the strong sales figures of the stock. Call options dominate the trading at the top brokers with Apple stocks. App Store figures recorded 29% y-o-y growth and in the Greater China area, there was a 100% y-o-y growth according to Apple CEO Tim Cook. 

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