Shares in Apple Inc. rose slightly in late trading today after the iPhone maker beat analysts’ expectations in its fiscal 2024 third quarter.
For the quarter that ended on June 29, Apple reported adjusted earnings per share of $1.40, up from $1.26 in the same quarter of 2023, on revenue of $85.8 billion, up 5% year-over-year. Both were beats, as analysts had been expecting earnings per share of $1.35 on revenue of $84.53 billion.
Through Apple’s product line, iPhone revenue came in at $39.3 billion versus an expected $38.81 billion; Mac revenue was a very slight miss, coming in at $7.01 billion versus an expected $7.02 billion; iPad revenue surprised at $7.16 billion, ahead of an expected $6.61 billion and wearables, home and accessories revenue was $8.1 billion versus an excepted $7.79 billion.
Apple’s services revenue, which covers revenue from the App Store, Apple Music, iCloud, Apple Pay, AppleCare, Apple TV+, Apple Arcade and Apple News+, came in at $24.21 billion, ahead of an expected $24.01 billion.
“During the quarter, our record business performance generated EPS growth of 11 percent and nearly $29 billion in operating cash flow, allowing us to return over $32 billion to shareholders,” Luca Maestri, chief financial officer of Apple, said in the company’s earnings release. “We are also very pleased that our installed base of active devices reached a new all-time high in all geographic segments, thanks to very high levels of customer satisfaction and loyalty.”
While Apple hasn’t given a formal outlook since the COVID-19 pandemic, on a call with analysts, Maestri said that Apple expects similar revenue growth in the current quarter as saw in its fiscal third quarter – 5%. In addition, Apple expects services to grow around the same rate as the previous three quarters – around 14%.
On the call, Apple executives also addressed other issues, including questions about the emergence of competing app stores in Europe. According to a transcript from Macrumors, the answer (it’s not specified who said what), was, “We have seen a good level of adoption from developers on those changes, we are in ongoing discussions with the European Commission on how to ensure full compliance with the DMA. In general, our results for the Services business and the App Store have been pretty good.”
Apple sales in China, which have continued to decrease, were also addressed, with the answer being that China’s “competitive environment is the most competitive in the world” and “the macroeconomic factors have been in the press too.”
On Apple’s rollout plans for Apple Intelligence, the company’s big artificial intelligence play, the answer was that Apple will “start with US English this fall and add more functionality, features and languages and regions coverage over the next year.”