Ends this quarter and as usual, the big technology companies have a date with Wall Street. Apple today announced financial results for its third fiscal quarter 2016, ended June 25, 2016. The figures are here and are nothing good, especially because of the drop in iPhone sales, it has even been said that the worst quarter in the history of Apple device.
The company recorded quarterly sales of 42,400 million dollars and a quarterly net profit of 7,800 million, equivalent to $ 1.42 per share. When comparing these figures, we can see a 15% drop over the same period last year, where sales were 49,600 million and a net profit of 10.700 billion or $ 1.85 per share. Overall, the figures for this quarter are related to low sales in virtually all its products.
A fall for the second consecutive semester iPhone sales
The iPhone had a challenging quarter for the second time since 15 % fewer units were sold compared to the same period last year, remaining at 40.4 million units in the quarter. With mobile, Apple earned 23 % less income compared to last year.
Of course, again factors such as the high dollar and cooling of the Chinese economy influenced phone sales in this market, which is one of the largest in the world for mobile telephony. Therefore, during the call of financial results, Tim Cook said that China will continue betting strong and will continue to invest in the Asian country, which represents a tremendous growth opportunity for the company.
But this was not the only device that reported a drop in sales. This quarter Apple sold 10 million iPads ( 9% less than the same quarter last year ), but the 9.7-inch iPad Pro gave a small boost to the category of tablets of the company, helping revenue this product will increase by 7%.
Similarly, in this quarter Apple sold 4.2 million Macs, up 11 % in units when compared to figures from Q3 2015, and 13% less in revenue. This decline is related to the lack of new products in the category of computers because this year the company has not made any release.
As for the category of ” Other Products” where are the Apple Watch, Apple TV, Apple Watch, Beats, iPod and accessories, the company reported a 16% drop compared to the same quarter last year.
Apple’s commitment to services
Pleasantly surprised Services pushing the company to exceed the expectations of Wall Street. According to the Cupertino firm, services revenue grew 19%, driven by the App Store, which reached a record high, Apple Music, Apple Pay and iCloud, which are helping the company to receive significant revenue.
“Our services business grew 19 percent year over the same period last year, and sales of the App Store have achieved their record high, while our customer base continued to rise and reached a record high threshold,” said Luca Maestri, Apple’s CFO. Therefore, it is noteworthy that only this quarter Apple reported 6 billion in services revenue.
Meanwhile, Tim Cook said the company is very excited by the response from customers and developers to software and services presented during the WWDC in June, as called IOS 10 as the biggest release of iOS so far. Even during the financial results call, Cook said that they expect their services unit ” is the size of a Fortune 100 company next year .”
Surpassing the expectations of Wall Street
Although you can say that this was not a good quarter for sales of Apple products, the company beat Wall Street expectations. I expected to see a worse scenario, where the profit per share will stand at $ 1.39, and not at $ 1.42, as happened . Therefore, Apple benefited in the bag, which presents an increase of 5 % in after-hours trading.
IPad sales also propelled the Cupertino firm in the bag, a different picture as expected when in fact the 9.7-inch iPad Pro helped revenue rose 7 %.
Questions and answers Press
Now, finally, some of the most interesting points that asked the press during the traditional call with Tim Cook to discuss the results:
- Pokémon Go and augmented reality. One of the journalists asked Tim Cook on the phenomenon of Pokémon Go and the future of augmented reality, to which Cook responded: ” Augmented reality can be huge. We have been and will continue to invest heavily in this (…) We believe there are great things for customers and a great business opportunity. The first is sure to make products that work well with products from other developers like Pokémon, is why you see so many iPhones chasing Pokémons “.
- Upon closing of the books and movies services in China. Faced with this question, Tim Cook said the financial impact of this was small, less than $ 1 million in the months that were available, and stated that Apple is working with Chinese government agencies on the issue.
- Rates on iPhone update. Tim Cook said the update cycle for 6s closely resembled the 5s but reached many significant improvements that sped up the process of renewal.