Apple. AAPL reported lower-than-expected first-quarter profit and earnings. iPhone revenue fell short of expectations, but strong performance in services and iPad offset some of the weakness.
How Apple evaluated key metrics for the first quarter: Cupertino, Calif.-based Apple reported first-quarter earnings of $1.88 per share, below consensus expectations of $1.94 per share and down from a year ago’s EPS of $2.01.
Apple’s top line fell 5% year over year to $117.2 billion, below consensus expectations of $121.1 billion.
The first quarter of Apple’s fiscal year, December, is also one of the busiest and best seasonally. Expectations were disappointed this time as well.
At the fourth quarter results briefing held in late October, the CFO Luca Maestri It said year-over-year growth in sales would slow in the December quarter. He pointed to his 10-percentage-point impact from the negative impact of the currency, slowing service sector revenue growth due to macroeconomic challenges, and a sharp decline in Mac revenue due to harsh comparisons.
The first quarter of 2022 benefited from the launch of the newly redesigned MacBook Pro with the M1 chip and the accompanying fill. Since then, the dollar has weakened amid the Fed’s interest rate normalization.
“During the December quarter, we achieved a major milestone and are pleased to report that we now have over 2 billion active devices as part of growing our installed base,” said Apple CEO. says Tim Cook.
Margin Profile: Gross margin was 42.96%, in line with the company’s guidance of 42.5% to 43.5%. This compares with 42.26% in the previous quarter and 43.76% in the same period last year.
Unlike other tech companies, Apple has not announced any major layoffs.Wedbush’s Daniel Ives The company said it was unlikely to announce a major phase-out as it is uniquely positioned to withstand economic storms.
See also: What You Need to Know About Apple Stock
Apple revenue by product, by region: iPhone sales fell 8.17% year-on-year to $65.78 billion, below Morgan Stanley analyst estimates of $68.9 billion. Eric Woodring. He modeled $75.5 million in shipments and an average selling price of $916.
In October, the company’s supply chain partner Honghai Precision Manufacturing Company Limited HNHPF had to close its main iPhone assembly plant in Zhengzhou, China. Apple came back in early November and said the facility was running at a significantly reduced capacity. As such, the iPhone 14 Pro and iPhone 14 Pro Max will ship less than previously expected.
“Overall earnings growth on a constant currency basis despite a challenging macroeconomic environment and significant supply constraints,” said Maestri.
Leveraging the company’s massive installed base of active devices, its services business grew 6.4% year-over-year to $20.77 billion, a record high.
iPad revenue increased 29.64% to $9.4 billion, while Mac revenue decreased 28.72% to $7.74 billion. Morgan Stanley’s Woodring estimated iPad and Mac revenues at $8.5 billion each and he at $9 billion.
Wearables, home and accessories revenue fell 8.29% to $13.48 billion.
Geographically, Apple saw year-over-year declines in all regions. In the Americas, where he took about 42% of total revenue, revenue fell by 4.31% to $49.28 billion. Greater China revenues decreased 7.28% to $23.91 billion.
Apple Shareholder Returns: Apple said it was returning more than $25 billion to shareholders during the quarter while also investing in long-term growth plans.
The company’s board of directors declared a dividend of 23 cents per share. This dividend will be paid on February 16th to shareholders of record on February 13th.
AAPL Price Action: After hitting an all-time high of $182.94 in early January 2022, Apple’s stock plummeted throughout the year. The low for the year was $125.87, hitting the end of December. The stock has fallen 26.41% over the year, but not as much as his 33% decline in the Nasdaq Composite.
Apple’s stock has rebounded along with the broader market this year. Year-to-date, the stock is up 11.93%.
According to TipRanks, Apple’s average price target for analysts over the 12-month period is $173.44, suggesting a potential upside of 19.26%.
The stock fell 4.02% in after-hours trading to $144.75, according to data from Benzinga Pro.
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