With earnings season in full swing, Apple has revealed some interesting details in its latest financial report. Even though revenues reached a record for a full quarter, the company seemingly confirmed some reports that the iPhone X failed to capture hearts and minds, with it reportedly slashing production in half.
According to the report, the company posted full quarter revenues of $88.3 billion, which was up 13% from the year prior. This increase was mostly thanks to a jump in sales of its products in the international market. The iPhone maker revealed that it has seen an 11% increase in revenue in China, even with that market declining for the first time. The international market contributed a massive 65% share in this quarter's earnings.
The CEO of Apple, Tim Cook commented on the record-setting report:
“We’re thrilled to report the biggest quarter in Apple’s history, with broad-based growth that included the highest revenue ever from a new iPhone lineup. iPhone X surpassed our expectations and has been our top-selling iPhone every week since it shipped in November. We’ve also achieved a significant milestone with our active installed base of devices reaching 1.3 billion in January. That’s an increase of 30 percent in just two years, which is a testament to the popularity of our products and the loyalty and satisfaction of our customers.”
However, not everything has been rosy for the tech giant. Apple iPhone shipments decreased by 1% compared to the same quarter prior, coming in at 77.3 million units. Revenues increased by 13%, thanks to the higher MSRP demanded by the iPhone X. The iPad showed the opposite, with shipments increasing by 1% to 13.1 million units. For the Mac, both revenue and unit numbers decreased by a uniform 5%. The services division - which is responsible for products like iTunes and the App Store - posted an increase in revenue of 18%.
Net profit increased to $20 billion for the quarter, up from $17.8 billion in the quarter prior. According to Apple, it will return $14.5 billion of this to its investors through its capital return program. It also pointed to a strong second quarter of 2018, with expected revenues to come in at around $60 billion. The company declared a cash dividend of $0.63 per share, payable on February 15.
Thanks to tax reform in the U.S., Apple reportedly vowed to increase investment in that country, creating an estimated 20,000 jobs in the process. According to this report, it expects the effective tax rate in the next quarter to come in at 15%. The Cupertino technology giant officially opened up pre-orders for its answer to the threat of Amazon's Alexa, the HomePod last month. The smart speaker retails for $349 and will ship first to the United States, UK, and Australia.