You will be redirected back to your article in seconds

iPhone Sales Rebound in Holiday Quarter, Apple Posts Record Sales but Declining Profits

Call it the Note 7 rebound: Apple sold more iPhones during its most recent quarter than during the same quarter a year ago, returning to growth after several quarters of declining sales. Sales were up 5 percent, to a total of 78.3 million devices sold during the quarter.

Apple made these announcements as part of its fiscal Q1 2017 earnings release.

The company generated $78.4 billion in revenue during the holiday quarter, compared to $75.9 billion a year ago. The company’s net income for the quarter was $17.9 billion, compared to $18.4 billion during the previous year. This equals earnings per diluted share of $3.36, compared to $3.28 a year ago.

Analysts had expected earnings per share of $3.22 and revenue of $77.4 billion.

“We’re thrilled to report that our holiday quarter results generated Apple’s highest quarterly revenue ever, and broke multiple records along the way. We sold more iPhones than ever before and set all-time revenue records for iPhone, Services, Mac and Apple Watch,” said Apple CEO Tim Cook in the earnings release.

The return to growth for iPhone sales is significant as a major revenue driver for the company: iPhones accounted for more than 70 percent of all of Apple’s revenue during the quarter. iPhone sales declined over several quarters for the first time in the company’s history in 2016. 

Decline of iPhone sales also put more pressure on the company to unveil the next big thing, especially as both iPad and Macintosh sales have been declining for some time.

What’s more, it doesn’t look like either the Apple Watch or Apple TV are going to be this next big thing any time soon. Apple hasn’t broken out sales of either product, and instead lumps revenue for both up with sales of iPods, Beats headphones, dongles and other products. This “other” category declined during Apple’s most recent quarter, accounting for a total of $4 billion in revenue, compared to $4.3 billion a year ago.

That’s especially significant because Apple executives have gone out of their way to cast Apple Watch as a success story. On Tuesday, Cook said that Apple Watch was one of the products breaking “all-time revenue records” for the company.

Given the grouping of the two products, one has to assume that Apple TV sales were disappointing. “We are pleased with how that platform has come along,” Cook said Tuesday without specifically commenting on unit sales. He added that the company still had “planned more” for Apple TV.

There’s one other area in which Apple actually is growing: The company generated $7.2 billion with services during the quarter, compared to $6 billion a year ago. This includes both App Store transactions as well as subscription revenue generated with Apple Music.

Apple CFO Luca Maestri said during the company’s earnings call Tuesday that Apple’s services business alone is now the size of a Fortune 100 company, and estimated that Apple will be able to grow this business by 100 percent in the next four years.

To get there, Apple may also spend more money on original video. “We have put our toe int he water with doing some original content for Apple music,” Cook said Tuesday. Those efforts would roll out in the coming months, giving the company a chance to learn. “We will go from there,” he said.

More Digital

  • Game of Thrones Season 8 Production

    'Game of Thrones,' Netflix VFX Among Those to Be Featured in SIGGRAPH Production Talks

    VFX pros behind the final season of “Game of Thrones,” the blockbuster film “Avengers: Endgame,” Pixar’s upcoming “Toy Story 4,” last year’s Oscar-winning “Spider-Man: Into the Spider-Verse,” Netflix series, including “Stranger Things,” and more will give SIGGRAPH 2019 attendees a behind-the-scenes look at their work during the conference’s Production Sessions. There will even be a [...]

  • Patrick Drahi

    Altice's Patrick Drahi to Acquire Sotheby's Auction House for $3.7 Billion

    Patrick Drahi, the owner of the telecom group Altice, is on track to purchase Sotheby’s, the high-profile auction house, for $3.7 billion. The acquisition would turn Sotheby’s into a privately owned concern after 31 years as a publicly listed company on the New York Stock Exchange. Drahi said the acquisition had “no capital link with Altice [...]

  • Soundgarden’s Immersive 'Artists Den' Experience Premieres

    Soundgarden’s Immersive 'Artists Den' Experience Premieres This Week (Exclusive Preview)

    There’s no question that the posthumous release is the most difficult to get right: Human beings are unpredictable, and trying to guess what a person’s intentions might have been is an unhill (if not a losing) battle. Yet posthumous releases ranging from Michael Jackson’s “This Is It” to recent Prince and Jimi Hendrix collections prove [...]

  • Dwayne Johnson Skyscraper

    People Really Want The Rock as the Voice of Their Smart Speaker

    Maybe Google was onto something when it used John Legend as the voice of its smart speakers: Nearly 1 in 3 participants in a recent Adobe smart speaker survey said that they want a celebrity as the voice of their AI assistant. Participants of the Adobe Analytics June 2019 Voice Report also had some clear [...]

  • jfk mooonshot ar app artwork

    JFK Presidential Library Releases Moon Landing Augmented Reality App

    The John F. Kennedy Presidential Library has released an augmented reality app (AR) to commemorate the 50th anniversary of the moon landing, and the role President Kennedy played in getting the U.S. to the moon. The app, which is available for free for iPhones and Android, lets users relive the Apollo 11 mission in their [...]

  • hdhomerun roku app

    HDHomerun App Brings Live TV to Roku Devices

    Roku users are getting another way to watch live television with the help of their favorite streaming devices: Silicondust, maker of the HDHomerun TV tuners, has released a beta version of its HDHomerun app for Roku TVs and streaming devices. “We need to start out by saying this is very much a beta product,” the [...]

More From Our Brands

Access exclusive content