Please ensure Javascript is enabled for purposes of website accessibility
Apple Holiday Season Tops Projections as iPhone Bounces Back
gvw_ap_news
By Associated Press
Published 5 years ago on
January 29, 2020

Share

SAN FRANCISCO — Apple is still reaping huge profits from the iPhone while mining more moneymaking opportunities from the growing popularity of its smartwatch, digital services and wireless earbuds.
That combination produced a banner holiday season for a company whose fortunes appeared to be sliding just a year ago amid declining sales for the iPhone, its marquee product for the past decade.
Apple’s fiscal first-quarter results, released Tuesday, provided the latest proof that the fears hanging over the consumer electronics icon might have been unfounded.
Apple’s profit and revenue for the October-December period topped analysts’ projections, providing another boost to a stock that has more than doubled in less than 13 months.
The shares surged more than 1% to $322.14 in extended trading after the numbers came out. That’s up from $142 in January 2019 after Apple warned that consumers weren’t buying as many new iPhones as they once were, especially in China, the company’s biggest market outside the U.S. and Europe. China is also where Apple makes most of its iPhones and several other products.
If the shares move similarly in Wednesday’s regular trading session, they will flirt with a new all-time high for the stock and further cement Apple’s position as the most valuable company in the U.S., with a market value of $1.4 trillion.

Photo of iPhones
A selection of iPhones are displayed an Apple store Tuesday, Jan. 28, 2020, in suburban Boston. Apple reports financial earns on Tuesday. (AP Photo/Steven Senne)

Apple Got off to a Fast Start for Fiscal 2020

deadly viral outbreak in China, which has curtailed travel and threatens the world economy, looms as a potential concern for Apple. But investors for now are focusing on what looks like an even more prosperous road ahead for a company that turned a $55 billion profit in its past fiscal year.

“The situation is emerging and we’re still gathering lots of data points and monitoring it very closely.” — CEO Tim Cook 
In a conference call Tuesday, CEO Tim Cook said the coronavirus outbreak has already caused some of Apple’s suppliers in China to delay reopening their factories closed for the Lunar New Year holiday from the end of this month until Feb. 10. And some stores in China selling Apple products already have temporarily closed or reduced their operating hours because fewer customers are shopping as virus worries escalate.
“The situation is emerging and we’re still gathering lots of data points and monitoring it very closely,” Cook said.
Apple got off to a fast start for fiscal 2020, with a first-quarter profit of $22.2 billion, or $4.99 per share, on revenue of $91.8 billion. Analysts polled by FactSet had predicted earnings of $4.54 per share on revenue of $88.5 billion.

Half the Price of Netflix’s Most Popular Plan

As usual, the iPhone remained Apple’s marquee attraction. Boosted by the release of the iPhone 11 heading into the holiday season, the product generated sales of $56 billion, an 8% increase from the previous year’s disappointing showing.
Besides rolling out high-end phones with more cameras and a starting price of $1,000, Apple sold a more basic model starting at $700 — a $50 drop from a comparable version released in 2018.
Apple’s division that includes its app store, product warranties, music streaming and a new Netflix-like video service delivered revenue of $12.7 billion, up 17% from the previous year. Apple is hoping its service division will produce revenue of at least $50 billion this year, doubling its output in just four years.
The services division is feeding into all iPhones, iPads, Macs and other Apple products already being used, which the company said Tuesday now totals 1.5 billion devices, up by 100 million from the previous year.
“We see this as a powerful testament to the satisfaction, engagement and loyalty of our customers — and a great driver of our growth across the board,” Cook said.
The Apple TV Plus video streaming service, which Apple launched amid great fanfare in October, is supposed to help that cause, but it may not be a huge contributor this year. That’s because Apple is initially selling it for just $5 per month to help drum up interest. That’s less than half the price of Netflix’s most popular plan.

Photo of an iPad and an iMac
An iPad Pro and a Macbook Pro are displayed an Apple store Tuesday, Jan. 28, 2020, in suburban Boston. Apple reports financial earns on Tuesday. (AP Photo/Steven Senne)

Apple Introduced the Airpods After Removing the Headphone Jack From the iPhone

What’s more, Apple is giving away a free year of Apple TV Plus to anyone who buys a new iPhone or several other devices, a promotion that means tens of millions of people aren’t paying anything for the service yet. Apple hasn’t released subscription numbers for the video service.
Meanwhile, the Apple Watch, which the company began selling nearly five years ago, continued to gain new converts, and the latest version of its wireless earbuds, AirPods, emerged as a hot commodity during the holiday season.
Apple introduced the AirPods after removing the headphone jack from the iPhone in 2016, but the product picked up more momentum in October with a next-generation set designed to fit better in people’s ears. That version, called AirPods Pro, proved so popular that Apple had trouble keeping it in stock. The AirPods Pro also cost more at $250, compared with $160 to $200 for the previous models.
All those factors helped Apple’s “wearables, home and accessories” category garner sales totaling $10 billion in the past quarter, a 37% increase from the previous year. That prompted Cook to hail it as a “blowout” quarter for the wearables and accessories division, which is now Apple’s fastest growing category.

DON'T MISS

Augillard, Douglas Lead the Way as Bulldogs Rally Past Long Beach State

DON'T MISS

Israel Strikes Without Warning in Beirut, Kills at Least 15 as Cease-Fire Sought

DON'T MISS

Trump Taps Rollins as Ag Chief in Final Cabinet Pick

DON'T MISS

Fresno State Becomes Bowl Eligible, Defeats Colorado State on Senior Night

DON'T MISS

After Fresno Visit, Newsom Announces $24.7M Taxpayer-Funded Apprenticeship Program

DON'T MISS

How Will Merced County Fund Public Safety After Measure R’s Failure?

DON'T MISS

As Atmospheric River Soaks California, Farmworkers Await Flood Aid Promised in 2023

DON'T MISS

Sacramento Region Gained People but Flubbed Economic Opportunities Over 50 Years

DON'T MISS

Nations at UN Climate Talks Agree on $300B a Year for Poor Countries in a Compromise Deal

DON'T MISS

What to Know About Lori Chavez-DeRemer, Trump’s Pick for Labor Secretary

UP NEXT

As Atmospheric River Soaks California, Farmworkers Await Flood Aid Promised in 2023

UP NEXT

Tulare County Man Arrested After Allegedly Threatening to Kill Middle School Girls, Staff

UP NEXT

Listeria Outbreak Tied to Yu Shang Food Leaves California Infant Dead and 10 People Sick

UP NEXT

Northern California Gets Record Rain and Heavy Snow. Many Have Been in the Dark for Days in Seattle

UP NEXT

Newsom Gaslights on Potential Gas Price Hikes in Fresno Visit

UP NEXT

What Will Happen to CNBC and MSNBC When They No Longer Have a Corporate Connection to NBC News?

UP NEXT

Major Storm Drops Record Rain, Downs Trees in Northern California After Devastation Further North

UP NEXT

Newsom Heads to Fresno, a County That Voted for Trump

UP NEXT

Conservative Professors and Students Are Beating CA Community Colleges in Court

UP NEXT

Thousands of University of California Workers Go on 2-Day Strike Over Wages, Staff Shortages

Fresno State Becomes Bowl Eligible, Defeats Colorado State on Senior Night

13 hours ago

After Fresno Visit, Newsom Announces $24.7M Taxpayer-Funded Apprenticeship Program

16 hours ago

How Will Merced County Fund Public Safety After Measure R’s Failure?

16 hours ago

As Atmospheric River Soaks California, Farmworkers Await Flood Aid Promised in 2023

18 hours ago

Sacramento Region Gained People but Flubbed Economic Opportunities Over 50 Years

18 hours ago

Nations at UN Climate Talks Agree on $300B a Year for Poor Countries in a Compromise Deal

1 day ago

What to Know About Lori Chavez-DeRemer, Trump’s Pick for Labor Secretary

1 day ago

What to Know About Scott Turner, Trump’s Pick for Housing Secretary

2 days ago

Trump Taps Investor Scott Bessent as Treasury Secretary

2 days ago

NATO Head and Trump Meet in Florida for Talks on Global Security

2 days ago

Augillard, Douglas Lead the Way as Bulldogs Rally Past Long Beach State

LONG BEACH — Amar Augillard led Fresno State with 25 points and David Douglas Jr. made a go-ahead 3-pointer with 42 seconds left as the Bull...

13 hours ago

13 hours ago

Augillard, Douglas Lead the Way as Bulldogs Rally Past Long Beach State

13 hours ago

Israel Strikes Without Warning in Beirut, Kills at Least 15 as Cease-Fire Sought

13 hours ago

Trump Taps Rollins as Ag Chief in Final Cabinet Pick

13 hours ago

Fresno State Becomes Bowl Eligible, Defeats Colorado State on Senior Night

16 hours ago

After Fresno Visit, Newsom Announces $24.7M Taxpayer-Funded Apprenticeship Program

16 hours ago

How Will Merced County Fund Public Safety After Measure R’s Failure?

18 hours ago

As Atmospheric River Soaks California, Farmworkers Await Flood Aid Promised in 2023

18 hours ago

Sacramento Region Gained People but Flubbed Economic Opportunities Over 50 Years

Help continue the work that gets you the news that matters most.

Search

Send this to a friend