Apple’s stock experienced a 3.8% decline in after-market trading due to a decrease in China sales and softer service revenue. This drop occurred despite a prior boost in revenue from frontloading tariffs and the announcement of a $100 billion buyback plan.
Apple’s performance in the quarter ending in March exceeded consensus estimates as follows:
- Earnings Per Share (EPS): $1.65 compared to the estimated $1.63 by LSEG
- Revenue: $95.4 billion compared to the estimated $94.66 billion by LSEG
- iPhone revenue: $46.84 billion compared to the estimated $45.84 billion
- Mac revenue: $7.95 billion compared to the estimated $7.77 billion
- iPad revenue: $6.4 billion compared to the estimated $6.20 billion
- Wearables, Home, and Accessories revenue: $7.52 billion compared to the estimated $7.95 billion
- Services revenue: $26.65 billion compared to the estimated $26.70 billion
During an earnings call, Apple CEO Tim Cook mentioned that the company felt limited impact from tariffs in the March quarter due to effective supply chain strategies. Looking forward, Apple anticipates single-digit revenue growth for the current quarter ending in June, a period when the company achieved $85.78 billion in sales last year.
“Strong quarterly results, including double-digit growth in Services. Excited to introduce the iPhone 16e and new Macs/iPads powered by Apple silicon. We’ve cut our carbon emissions by 60% over the past decade,” said Tim Cook.
Apple is also projecting a gross margin of 46%, factoring in tariff expenses. Analysts’ third-quarter guidance includes earnings per share of $1.48 on sales of $89.45 billion. Cook stated that tariffs are expected to increase costs by $900 million in the current quarter, with uncertainties beyond June due to unpredictable tariff developments.
“EPS grew 8%, driven by solid business performance and $24B in operating cash flow. Our installed base of active devices hit a new all-time high across all categories and geographies,” commented CFO Kevan Parekh.
