Apple (AAPL) missed Wall Street’s December quarter sales expectations late Thursday, owing to decreasing iPhone and Mac sales. Apple’s stock dropped in extended session.
In its fiscal first quarter, which ended Dec. 31, the Cupertino, Calif.-based corporation earned $1.88 per share on sales of $117.2 billion. FactSet polled analysts, who predicted earnings of $1.94 per share on revenues of $121.4 billion. Apple’s earnings plummeted 10% year on year, while sales dipped 5%.
Analysts were concerned about a probable slowdown in consumer spending on smartphones and internet services ahead of Apple’s earnings report. In addition, Apple had supply restrictions last quarter as a result of COVID-related outages at its major iPhone plant in China.
In the company’s earnings report, Apple executives highlighted the positive.
Chief Executive Tim Cook stated that the company had reached a significant milestone when its installed base surpassed 2 billion active devices. This includes iPhones, iPads, Macs, and other electronic devices.
Apple’s stock falls upon the release of the holiday quarter report.
Apple stock fell 3.9% to 144.93 in after-hours trade today on the stock market. Thursday’s regular session saw Apple shares rise 3.7% to settle at 150.82.
Luca Maestri, Chief Financial Officer, emphasized the company’s services business’s expansion.
“In our services business, we established an all-time sales record of $20.8 billion,” Maestri added. “And, despite a challenging macroeconomic climate and considerable supply restrictions, we increased overall company revenue in constant currency.”
In the December quarter, Apple’s services revenue climbed 6% year on year to $20.77 billion. However, hardware revenue fell 8% to $96.39 billion.
iPhone and Mac sales are down, but iPad sales are up. Apple’s iPhone revenue fell 8% to $65.8 billion in the December quarter. Wall Street was expecting $68 billion. Smartphones accounted for 56% of overall sales for the company during the period.
In the meantime, Apple’s Mac computer sales fell 29% to $7.7 billion. In addition, revenue from Apple’s wearables, home, and accessories division fell 8% to $13.5 billion.
Apple’s iPad business defied expectations, increasing 30% to $9.4 billion in the holiday period.
According to IBD Stock Checkup, Apple stock has a mediocre IBD Composite Rating of 54 out of 99.