Apple Services revenue soar to new all-time high and Installed base of active devices sets all-time record
Apple has revealed its financial performance for the third quarter of fiscal 2023, concluding on July 1, 2023. Despite a 1 percent year-over-year dip in quarterly revenue, which stood at $81.8 billion, the company reported a noteworthy 5 percent year-over-year increase in earnings per diluted share, totaling $1.26.
Apple’s CEO, Tim Cook, expressed satisfaction with the record-breaking revenue achieved in Services during the quarter. This achievement was driven by an impressive count of over 1 billion paid subscriptions. Additionally, robust iPhone sales in emerging markets contributed to the company’s ongoing success.
Cook emphasized that Apple remains dedicated to its values and is committed to fostering innovation that enhances customers’ lives while positively impacting the world. He noted the company’s strides in various domains, from education to environmental initiatives.
Luca Maestri, Apple’s CFO, highlighted the improved year-over-year business performance in the June quarter compared to the previous quarter. Notably, Apple’s active device installed base reached an all-time high across all geographic segments. Maestri also revealed strong operating cash flow amounting to $26 billion during the quarter. The company demonstrated its commitment to shareholders by returning over $24 billion and continuing to invest in long-term growth strategies.
Apple’s board of directors announced a cash dividend of $0.24 per share for common stockholders, payable on August 17, 2023. This dividend distribution underscores the company’s dedication to rewarding its shareholders.
To further engage stakeholders, Apple will broadcast a live stream of its Q3 2023 financial results conference call on August 3, 2023, starting at 2:00 p.m. PT. The webcast will remain available for approximately two weeks after the event, providing interested parties ample opportunity to access the information.
In summary, despite a slight decline in revenue, Apple’s Q3 2023 financial results reflect continued growth and strength across various segments, underpinning the company’s commitment to innovation, values, and shareholder satisfaction.
Apple stocks fall 5% as hardware slowdown overshadows another record quarter for services
Apple has marked its third consecutive fiscal quarter with record-breaking growth in its services sector. However, the company’s ongoing trend of declining revenue has cast a shadow on its performance. Despite a robust showing in segments like iCloud, Music, and Apple TV+, Apple’s fiscal third quarter revenue declined by 1.4% compared to the same period last year. This disappointing news seemed to overshadow the positive aspects, leading to a nearly 5% drop in share prices, closing at $181.99 on Friday.
Notably, the services segment, a standout metric, exceeded analyst expectations by generating over $21 billion in revenue, representing an 8% increase from the previous year. Apple Stocks also surpassed predictions for overall revenue and earnings per share. The company boasted an impressive installed base of 2 billion active devices. However, these highlights did not fully appease investors.
Apple’s revenue decline over consecutive quarters has been linked to sluggish sales of Mac and iPad products. CFO Luca Maestri acknowledged that the company anticipates a double-digit drop in revenue for these products compared to the previous year, attributing this decline to pent-up demand following factory shutdowns.
Analysts at Jefferies noted that Apple’s revenue guidance and product commentary hinted at slower iPhone growth than what Wall Street had anticipated.
While sales for the flagship iPhone, constituting around 50% of Apple’s total revenue, slightly missed expectations and were 2% lower than the previous year at $39.67 billion, some analysts view the situation optimistically. Despite the immediate market reaction, experts highlighted Apple’s strengths. In comparison to Android’s substantial sales decline, the relatively steady iPhone sales could be seen as healthy. Analyst Martin Yang from Oppenheimer emphasized that the long-term growth driver for Apple remains its services story.
Wedbush analyst Dan Ives also focused on the positive, hailing the standout performance of Services revenue. Ives predicted that services would experience double-digit growth, underscoring its significance in Apple’s broader re-rating and growth narrative.
CEO Tim Cook underscored the remarkable achievement of setting a services record in the latest quarter, driven by over 1 billion paid subscriptions. Despite highlighting the iPhone’s strength in emerging markets like India, Cook acknowledged the challenges posed by the current smartphone market in the United States.
In summary, while Apple’s services sector and certain financial metrics paint a positive picture, the company faces the headwind of declining revenue. This complex landscape underscores Apple’s ongoing efforts to balance its various business segments and navigate challenges in a rapidly changing market.
FAQ(s) about Apple
Q1. What is Apple’s full name?
On January 9, 2007, Steve Jobs announced that Apple Computer would be renamed Apple Inc., reflecting the company’s growing focus on consumer electronics. The change came as Apple was preparing to launch the iPhone, its first major foray into the mobile phone market.
Q2. Why Apple is better than Android?
Apple phones are known for their smooth performance and excellent internal storage. Even older iPhone models still work well, making them a good investment. This is because Apple designs its phones to work together seamlessly, from the hardware to the software. As a result, Apple phones are often seen as being more user-friendly and reliable than Android phones.
Q3. Who owns most of Apple?
Apple is a publicly traded company, meaning that its shares are owned by a large number of investors. However, the majority of shares are owned by institutional investors, such as The Vanguard Group. As of 2023, Vanguard holds 7.6% of all outstanding shares, making it the largest shareholder of Apple.
Q4. Is Apple No 1 company?
Apple was the world’s most valuable company in 2023, with a market capitalization of $2.75 trillion. Microsoft, Saudi Aramco, Alphabet, and Amazon rounded out the top five.
Q5. Who is the richest man in Apple?
Tim Cook is the CEO of Apple, a multinational technology company based in Cupertino, California. He is one of the richest people in the world, with an estimated net worth of $1.8 billion.
FAQ(s) about Apple Stocks
Q1. Is it good to invest in Apple Stocks?
Apple Stocks is generally considered a blue chip stock, which means that it has a long history of stable growth and returns. However, in 2022, the company’s stock price dropped from a high of $182.88 on January 3, 2022, to a low of $142.20 on December 20, 2022. This was due to a number of factors, including supply chain disruptions, rising inflation, and concerns about the global economy.
Q2. Where will Apple stocks be in 5 years?
Apple (AAPL) stock is expected to increase in value over the next five years. Analysts predict that the stock could reach $220 by the end of 2023, $250 in 2024, $315 in 2025, $370 in 2026, $425 in 2027, $465 in 2028, and $480 in 2029.
Q3. What is the Apple stocks prediction for 2025?
According to the latest long-term forecast, Apple stock price is expected to reach $200 by the end of 2023 and $250 by the middle of 2024. The stock is then expected to rise to $350 in 2025, $400 in 2026, $500 in 2027, $600 in 2029, $700 in 2031, and $800 in 2034.
Q4. What will be Apple stocks price in 2050?
Analysts predict that Apple stocks price (AAPL Stock Price) could reach $9,745 by 2050, with a higher target of $11,784. However, the most likely scenario is that the stock will remain at or around $11,071 by the end of the decade. Based on Apple’s historical performance, it is reasonable to expect the stock to continue to grow in value over the next 30 years.
Q5. Why is Apple stocks good in the long term?
Apple stocks have outperformed its peers in the last five years, rising 306%. This is more than any other company in the “big five” of tech, which includes Microsoft, Amazon, Alphabet, and Facebook. The company’s reputation for reliability with investors has helped its stock to perform well, even in difficult market conditions.
