Apple Inc. beats experts’ forecasts for quarterly revenue and profit by a significant margin

Apple Inc. announced its quarterly performance results on Tuesday. Beating the analysts’ estimates for profit and revenue by a significant margin, the stock responded with an around 3% initial surge following the earnings report. In after-hours trading, Apple had settled around 1% higher for the day.

On revenue’s front, Apple posted $91.8 billion in the first quarter that marked a 9% increase as compared to the same quarter last year when Apple’s revenue was severely hit due to weak demand in China. At $55.96 billion, revenue from iPhone alone was reported 8% higher.

Apple’s Figures Versus Analysts’ Estimates

Based on Refinitiv’s data, analysts were expecting Apple to note $88.50 billion in revenue in the recent quarter. Estimate for iPhone revenue, on the other hand, was capped at a much lower $51.62 billion.

Tuesday’s report further highlighted the U.S tech giant to have made $4.99 of earnings per share in the first quarter versus the forecast of $4.55. Services came out to be the only segment that saw a decline as per the earnings report. Analysts’ had anticipated $13.07 billion in services revenue while the company announced a much lower $12.7 billion. Revenue from Apple’s other products hiked to $10 billion in the recent quarter versus the estimate of $9.52 billion.

Experts had also forecast Apple’s gross margin to be capped at 38.1% in the first quarter, which came out at a slightly higher 38.4% on Tuesday. Following the upbeat quarterly performance, Apple is now expecting $63 to $67 billion in revenue in the second quarter with a gross margin of 38% to 39%. In light of the largely optimistic results, CEO Tim Cook called it a blockbuster quarter for Apple.

CEO Tim Cook Says Apple’s “Other Products” Category Could Be A Fortune 150 Company

The CEO also highlighted the rising demand for Apple’s “other products” category that includes the Apple Watch and Airpods. Generating $10 billion worth of sales in the recent quarter, Apple’s other products category, as per Cook, could be a separate Fortune 150 company. The smartphone manufacturer had previously announced plans of ramping up production by 10% in the first half of 2020. Since the majority of Apple’s suppliers have their production houses in mainstream China, the recent outbreak of Coronavirus that is spreading at a much quicker pace than expected is likely to pose a threat for Apple to deliver on its promise.

In the earnings report on Tuesday, Apple upgraded its count for active devices from the previous 1.4 billion to 1.5 billion currently.