Apple faced many challenges at the beginning of this year. The Apple Watch has been altered by patent litigation, the App Store has faced criticism from developers and the iPhone faces new competition in China.
To make matters worse, the company recently replaced Microsoft as the world's most valuable publicly traded company, dethroning it as the undisputed king of the stock market.
But on Thursday, the tech giant demonstrated the versatility and strength of its business, reporting a 2% increase in revenue to $119.58 billion for the three months to December. This is Apple's first quarterly revenue increase in a year, allowing the company to achieve a 13% increase in profits to $33.92 billion over the same period. . From a year ago.
The results showed that Apple has the ability to overcome the slump in device sales by getting its vast customer base to buy more apps and services, such as Apple Music. The company said its software and services revenue increased 11% to $23.12 billion in the same period.
Apple stock fell by about 1 share. In after-hours trading, the company's sales were down 1.5%, even though the company's sales exceeded analysts' estimates of $117.99 billion.
The company's flagship products, the iPhone and iPad, are more than a decade old, but Apple said last year that the number of its devices in use around the world has doubled from the 2 billion it reported a year ago. It was announced that the number of units increased by 1 billion units. Investors are watching the numbers because more people are paying Apple for things like cloud computing storage as the iPhone, iPad and Apple Watch become more popular.
The iPhone accounts for more than half of Apple's annual revenue and was the only Apple device whose sales increased during the quarter. Apple sold an additional 5 million smartphones last year after launching a new titanium version of the device, according to market research firm Canalys. This increase pushed iPhone sales up 6% to $69.7 billion.
However, declines in sales of wearable products such as the iPad and Apple Watch and flat sales of Macs weighed on the company's total device sales, which were at $96.46 billion, about the same as in the same period last year.
In the days before Christmas, Apple warned customers that it would have to suspend sales of the Apple Watch after losing a patent lawsuit over its pulse oximetry feature. To continue selling, the company overhauled the new watch's software and removed features.
In China, Apple's second-largest market, the company is weathering a slowing economy and increasing competition. While Chinese consumers are cutting back on spending, Chinese mobile phone giant Huawei has released smartphones with higher-quality cameras and lower prices than Apple's. In order to keep pace, Apple has started discounting his iPhone in China.
Apple's growth has lagged behind that of other tech giants. On Tuesday, Microsoft said its quarterly revenue rose 18% to $62 billion, and Google's parent company Alphabet said its revenue rose 13%.
As these companies aggressively embrace generative artificial intelligence, their value has skyrocketed, but Apple has been slow to embrace it. CEO Tim Cook said last year that AI-related research was “in progress,” but declined to provide details.
Instead, Apple is focusing on releasing Vision Pro, an augmented reality headset. The company launched the $3,500-priced device in mid-January, and the first batch of about 200,000 headsets sold out, according to analyst estimates. The company plans to start shipping the devices on Friday.
