Apple meets sales estimates, but China region remains weak spot
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Apple beat Wall Street sales and profit expectations on Thursday for its fiscal fourth quarter, bolstered by strong early sales of iPhone 16, a set of phones designed for new AI features that was released near the end of the quarter.
Apple said sales were $94.93bn (€87.5bn), ahead of Wall Street targets, according to LSEG.
Earnings of $1.64 per share, excluding the massive €14.4bn tax charge to Ireland, topped analyst expectations of $1.60 per share.
Sales of its iPhone, the company’s main product, were up 5.5% to $46.22bn (€42.6bn). Other product lines missed expectations.
Apple’s fourth quarter ended September 28, meaning it reflects only a few days of sales of its iPhone 16 series that went on sale on September 20. Apple chief executive Tim Cook told Reuters that iPhone 16 sales grew faster than iPhone 15 sales did a year earlier, with both phones on sale for the same number of days in the fourth quarter.
He also said Apple customers are downloading a new version of its iPhone operating system with what it calls Apple Intelligence features at twice the rate they had the year before.
“We’ve had great feedback from customers and developers already,” Mr Cook said. “We’re off to a good start.”
The rollout of Apple’s artificial intelligence strategy, which it revealed this year, hinges on how well its new phones sell.
Rather than introduce AI in a standalone app or service, Apple has sprinkled Apple Intelligence throughout its most recent operating systems as new features, such as the ability to help re-write an email in a more professional tone.
Those features will mostly be available on iPhone 16 models, which feature more powerful computing chips, although the pro versions of the iPhone 15 both work with Apple Intelligence.
While some of those Apple Intelligence features arrived this week, others have been delayed, which has led some Wall Street analysts to wonder whether consumers will be slower to upgrade their devices this year while flagship software features trickle out.
The early iPhone 16 results on Thursday could allay some of those concerns.
IPhone sales helped steady Apple’s fourth-quarter sales in China, which were down less than 1% to $15.03bn (€13.9bn) overall.
Analysts were expecting China sales of $15.78bn (€14.5bn) on average, according to data from Visible Alpha.
- Reuters