Apple’s earnings for Q419 have been unveiled, along with a forecast for the first quarter of the 2020 fiscal year.
The fiscal 2019 fourth quarter ended on September 28th, 2019. Apple has posted a quarterly revenue of $64 billion, which is a 2% increase from the year-ago quarter, and the biggest fiscal fourth quarter the company has ever experienced. During this time, international sales accounted for 60% of the quarter’s revenue.
Q419 has seen Apple has been doing better than analyst expectations, with its revenue of $64 billion being higher than the predictions from Refinitiv that estimated a smaller intake of $62.99 billion. Earnings per share were also higher than predicted, with an actual earning of $3.03 over the estimated $2.84.
However, despite this success, iPhone sales are down by an entire 9.2%, bringing in $33.36 billion. On the other hand, iPad sales are up by 16.9% with revenue of $4.66 billion, while Mac sales are down by 4.8%, although they still brought in $6.99 billion. Wearables, Home, and Accessories saw the most growth, with sales up by an entire 54.4%, and generating $6.52 billion.
As such, we can see that Apple’s Wearables business (for things such as AirPods and the Apple Watch) has been an unexpected success this last quarter by successfully defying pundits, who foresaw a limited market for the accessories.
As mentioned above, iPhone sales were down more than expected, which is unusual given the rumours of success of the iPhone 11. On the other hand, while Apple services are up with an intake of $12.51 billion, they remain limited by Apple only serving their own platform.
According to the forecast report, Apple is predicting the following for the first quarter of the 2020 fiscal year:
- Revenue between $85.5 billion and $89.5 billion.
- Gross margin between 37.5% and 38.5%.
- Operating expenses between $9.6 billion and $9.8 billion.
- Other income/(expense) of $200 million.
- Tax rate of approximately 16.5 percent.
Tim Cook, Apple’s CEO, appears quite positive about the upcoming quarter, and was quoted as saying the following:
“We concluded a groundbreaking fiscal 2019 with our highest Q4 revenue ever, fueled by accelerating growth from Services, Wearables and iPad. With customers and reviewers raving about the new generation of iPhones, today’s debut of new, noise-cancelling AirPods Pro, the hotly-anticipated arrival of Apple TV+ just two days away, and our best lineup of products and services ever, we’re very optimistic about what the holiday quarter has in store.”
Luca Maestri, Apple’s CFO, also had the following to say:
“Our strong business performance drove record Q4 EPS of $3.03 and record Q4 operating cash flow of $19.9 billion. We also returned over $21 billion to shareholders, including almost $18 billion in share repurchases and $3.5 billion in dividends and equivalents, as we continue on our path to reaching a net cash neutral position over time.”
You can read Apple’s condensed consolidated statements of operations for yourself by following the link here.