Apple iPhone sales rise in holiday quarter

Allan Goodman
February 1, 2017

Sales were up 5 percent, to a total of 78.3 million devices sold during the quarter. Analysts are expecting the company to report earnings per share of $3.23, down from $3.28 in the year-earlier period, which has been expected to be a huge drop yet again.

The revenue report for China was the only blemish during a quarter that showed a record $78.4 billion in revenues. "If you look at 7 Plus, it was the most popular Plus model that we've ever had; it set a unit record so that I can share", Cook said. A year ago, Apple sold 5.3 million Macs.

Tim Cook credited strong iPhone sales over the holidays for boosting Apple's bottom line. "We feel great about this momentum, and our goal is to double the size of our Services business in the next four years". However, revenue in the "other products" category (which covers things like Beats, the iPod, Apple TV and accessories in addition to the Apple Watch) declined year over year, so the Watch wasn't quite enough to make up for losses in other product categories. Whereas the company reported shipping 5.31 million units in the first quarter of 2016, it reported shipping 5.37 units for its Q1 2017 fiscal quarter.

Kevin Krewell, principal analyst at Tirias Research, said a higher than normal number of "switchers" from Android to Apple during the quarter-the first quarter of Apple's fiscal 2017-may have been related to rival Samsung Electronics Co. Services revenues hit $7.2bn, an 18 per cent rise compared with the same period previous year.

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Revenue from Apple's services businesses, like iTunes and AppleCare, continued to jump in the quarter, up 18 percent to $7.2 billion.

Luca Maestri, Apple's chief financial officer, said the business performance resulted in a new all-time record for earnings per share, and over $27bn in operating cashflow. Worldwide, smartphone profits reached $9.4 billion during the third quarter of the year - 91% of which went to Apple - according to recent findings from Strategy Analytics.

The revenue surge, which analysts attribute to booming iPhone sales, exceeded expectations and sent Apple stock up 2.5 percent to $124.30 in after-hours trading.

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