The technology giant warned investors twice about this during a conference call on Thursdaywhat Apple observers will say will be delayed among other things from its typical start in September.
“As you know, we started selling iPhones at the end of September last year. We plan to have the offer available a few weeks later this year,” said Luca Maestri, CFO of Apple.
When an analyst later asked him for clarification, Maestri said a new iPhone was coming, we just had to wait. “A year ago, we launched the new iPhone at the end of September,” he said. “This year, the new product will be delivered a few weeks later.”
There is a reason for Wall Street. The smartphone is Apple’s most important product and has accounted for more than half of its sales in at least the past six years. The device is also instrumental in making Apple the juggernaut it is today. It is valued at over $ 1.65 trillion on Wall Street and produces over 1.5 billion devices that are used actively around the world.
Apple’s recent financial reports are just the latest indication of how the coronavirus pandemic has affected the global economy. Counterpoint Research sales of smartphones in the United States declined by a quarter over the same period. Apple generates most of its revenue from the sale of its iPhones, which rose slightly compared to the previous year.
By and large, more than 40 million Americans have applied for unemployment and raised questions about whether consumers will have an appetite to buy expensive new equipment. US GDP, a measure of the American economy, saw its largest quarterly decline since its inception, dropping 32.9% between April and June.
The US government has attempted to address these issues with increased unemployment benefits, although this program has ended for around 30 million Americans last weekend and will have further effects in the coming months. And although the stock market is rising to an all-time high, economists fear that if Congress doesn’t implement another round of incentives and unemployment benefits that it is negotiating about, it may not last.
However, an increase in COVID-19 cases in various parts of the United States that started in June and continues today, with Florida reporting a one-day death report for the third time in a row, raises questions about Apple’s prospects in the coming months. Though Apple is hailed as one of the best supply chain companies in the world, bringing together a network of hundreds of suppliers to make its devices mainly in China, Apple observers fear that COVID-19 may continue to be affected by the shopping season as it prepares for vacation.
“We took an approach that you know we are trying to understand how the virus develops over time,” said Maestri.
Investors did not appear to be affected by the delay as Apple shares gained more than 5% after the close of trading after closing more than 1% at $ 384.76 per share. Apple’s shares have soared more than 28% so far this year.
Despite the iPhone’s relative problems, Apple said its other product categories performed well.
In the three months of the third fiscal quarter, which ended on June 27, Apple had iPad sales of $ 6.6 billion, up 31% year over year. Mac computer sales were nearly $ 7.1 billion, up more than 21% year over year. Tim Cook, Apple’s CEO, found that these categories benefited from the environment and people who were locked in their homes were likely to be looking for devices for work or entertainment.
The company’s wearables and service business, which is smaller than the iPhone business but is an integral part of Apple’s future, both saw double-digit growth. The Wearables segment, which includes the Apple Watch and AirPods, generated sales of $ 6.5 billion. The services, including subscription services such as Apple Music and Apple TV Plus, had sales of $ 13.2 billion.
Even the iPhone, whose slower production in China prompted Apple to do sogenerated sales of $ 26.4 billion, an increase of more than 1% over the same period last year. At that time, lockout orders included worldwide and the temporary closure of Apple retail stores. The minor nuisance is also better than last year, when Apple saw iPhone sales drop nearly 12% in the spring months prior to the release of its iPhone 11.
Overall, Apple generated a profit of $ 11.3 billion, an increase of 12% over the previous year. This equates to earnings of $ 2.58 per share on total sales of $ 59.7 billion, up 11% year over year. This was also much higher than analysts’ prediction that the company would average earnings of $ 2.04 per share on sales of $ 52.3 billion, according to surveys by Yahoo Finance.
“In uncertain times, this achievement is testament to the vital role our products play in our customers’ lives and Apple’s tireless innovation,” Cook said in a statement. He found that Apple saw growth in each of its international markets, including China, where sales grew 1%, although it was the epicenter of the first outbreak of the corona virus.
While Cook indicated that his company had some sort of grip on the corona virus, he warned that the company was likely to struggle to meet iPad and Mac demand during the important period. Analysts believe uncertainty about the reopening of schools, despite the economic turmoil, may lead to more technology purchases by families and may put even more pressure on Apple to provide devices.
“We have a fantastic range of products,” said Maestri. “And we know that these products are incredibly relevant, especially under the current circumstances.”