Despite store closures, lockdowns, and the biggest health crisis of this generation, Apple reported $59.7 billion in revenue, beating market expectations of $52.25 billion. Apple also reported iPhone revenue of $26.42 billion vs. $22.37 billion in market expectations.
For the Mac and the iPad, Apple CEO Tim Cook said that remote learning helped boost sales, while the iPhone saw slow sales in the first 3 weeks of April as COVID19 began to emerge.
“We’re conscious of the fact that these results stand in stark relief during a time of real economic adversity for businesses large and small, and certainly for families,Apple CEO Tim Cook to Analysts
While Mr.Cook did acknowledge that iPhone sales were slow and grew only 1.66% year over year, iPad sales shoot up 31% and wearables including the Apple Watch and Airpods went up 16.74%. As for the Mac Apple stopped short of referencing a specfic growth percentage but said that remote learning and work from home helped the Mac see a strong quarter.
As for services which is more recently the company’s backbone, Apple says it made a new record for doubling its services revenue 6 months ahead of schedule. The company reported $13.16 billion, vs. $13.18 billion in expectations. Year over year, Apple CEO Tim Cook said that its services grew 14.85 %
Apple touted the sucess of the iPhone SE, launched earlier this year with Mr. Cook saying Apple saw a “very nice uptick” in new iPhone users coming from Android. In regards to the iPhone, perhaps for the first time in history, Apple acknowledged and confirmed that the iPhone 12 will be released “a few weeks later” than normal, hinting towards the end of September.
Apple also announced for the first time in 6 years, and the 5th time in its history a stock split. This year the company is going for a 4-1 stock split meaning that each shareholder will get 3 additional shares on August 24th according to Apple in a press statement. Trading based on the 4-1 split will begin on August 31st, 2020.
Looking forward Apple will not provide Q4 guidance, but CFO Luca Maestri said that momentum and growth from the quarter will carry through to Q4. In total, Apple reported not a single drop in any product, or service, a remarkable feat given the current economic landscape. The company attributed its quarter’s performance to its loyal customers and a recent stimulus package in the United States.
What was clear as Apple reported the earnings is that its strong base of devices and its strong infrastructure around services provided it a leg-up going into COVID19. Apple was not forced to adjust in any major way, besides store closures its business models. Apple services remained steady with the company adding new games to Apple Arcade and new shows/movies to Apple TV+.