Apple shares seen higher despite iPhone sales miss as outlook suggests interesting plans
Apple shares ended in the green Thursday and are poised to open a little higher later in the US Friday, as its earnings release reported record revenues for the tech innovator. Investors also seem to like the potential plans Apple could enact as it said it intends to reduce down its cash pile.
Apple shares closed 0.21% higher at $167.78, in the US Friday. In after-hours trading activity, Apple shares are currently 0.66% higher.
Record revenues for Apple
Apple’s revenue for the final three months of 2017 – it’s first fiscal quarter – hit $88.3 billion, an 13% increase from the same period a year earlier and the highest on record. The tech giant also announced earnings per share grew 16% to $3.89, another all-time high.
International Apple product sales made up some 65% of total sales for the business.
“We’re thrilled to report the biggest quarter in Apple’s history, with broad-based growth that included the highest revenue ever from a new iPhone line-up,” said Apple’s CEO Tim Cook in the earnings press release.
“iPhone X surpassed our expectations and has been our top-selling iPhone every week since it shipped in November,” Cook added.
However, while iPhoneX sales may have surpassed Apple’s expectations, it missed anlaysts’. Apple reported 77.3 million iPhones were sold in its first quarter ending December 2017. That was lower than most analysts had anticipated.
Apple’s outlook interests
Apple’s outlook was initially considered cautious – the global tech firm said it expects revenue growth of between 13-17% in the current quarter end March. That would give revenues of between $60-$62 billion, which is below many analyst’s outlook.
However, Apple also said it plans to reduce its cash balance to “approximately zero”. That suggests that aside from potential increased dividend payments and possible share buy-backs, the company could be on the look out for some significant acquisitions.
In post release earnings call, an FT.com report show that Apple’s CFO said all of Apple’s $163 billion net cash holdings “will be deployed for capital allocation.” He added that could include a mixture of buybacks, dividends and M&A activity.