Apple Reports Best Quarter Ever: $78.4 Billion Revenue, 78 Million iPhones Sold

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After three consecutive quarters of year-over-year sales declines, Apple announced its biggest quarter ever. The company beat revenue and earnings expectations, selling more than 78 million iPhones.

Apple revenues came in above the high end of guidance. The company reported revenue of $78.4 billion vs. an expectation of $77.25 billion. It sold 78.2 million iPhones vs. 76 million expected. Indeed all product lines posted increases. Across the board it was Apple’s best quarter.

Here are numbers:

  • iPhones: 78.3 million units, $54.4 billion in revenue
  • iPad: 13.1 million units, $5.5 billion in revenue
  • Macs: 5.4 million units, $7.2 billion in revenue
  • Services (including Apple Pay, Apple Care): $7.2 billion in revenue.
  • Other (including Apple TV, Apple Watch, Beats products): $4 billion in revenue.

Apple earnings

At the end of the December quarter, Apple had $241 billion in cash and marketable securities.

International sales were roughly 59 percent of total revenue. The company said it had net profit of $18.4 billion. The Americas, Europe and Greater China were the company’s top markets, in that order.

Notes from the earnings call:

CEO Tim Cook ticked off record sales across Apple product categories: iPhones, Macs, Apple Pay, Music, Watch, services revenue. Among other stats mentioned, Cook said there are more than 2 million small businesses using Apple Pay (some via third party partners).

He talked about smart home automation and integration with HomeKit and Siri. He also said there are now more than 2.2 million apps.

Apple’s services revenue “is going to be the equivalent of a Fortune 100 company this year” and the company hopes to double it in the near term.

The iPhone 7 was the best selling phone in China during the quarter. Apple the most popular US brand during Singles Day in China.

CFO Luca Maestri: There was double digital iPhone growth in both developed and emerging markets. iPhone 7 Plus has seen extremely strong demand and has a 99 percent customer satisfaction rating according to third party research.

Services revenue increased 18 percent YoY to more than $7 billion. App Store revenue growth was 43 percent YoY. Apple retail stores also saw significant growth globally.

Apple generated its highest ever Mac quarterly revenue. The iPad sold 13.1 million units. Apple tablets have 85 percent of the market for tablets above $200.

Selected analyst questions:

Content producer acquisition: Cook was asked about whether the company would make a major content-producer/distributor acquisition if Apple’s $241 billion in cash (mostly overseas) were repatriated. Cook sounded like he was very open to a content-producer acquisition. Cook said that no acquisition was off the table or “too large.” The issue is whether there would be a strategic fit. Apple is “putting its toe in the water” and doing some original content for Apple Music and “learning from that.”


About The Author

Greg Sterling is a Contributing Editor at Search Engine Land. He writes a personal blog, Screenwerk, about connecting the dots between digital media and real-world consumer behavior. He is also VP of Strategy and Insights for the Local Search Association. Follow him on Twitter or find him at Google+.


 

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