Apple Reports Biggest Company Profit Ever Despite Drop in iPhone Sales

Tim Cook

"iPhone X surpassed our expectations and has been our top-selling iPhone every week since it shipped in November [last year]". He added that iPhone X was the best-selling smartphone in the world in the December quarter, according to market watcher Canalys.

Even though Wall Street had been bracing for some weakness, and Apple's trumpeted iPhone X was on sale for only two months of the quarter, it's not a great sign that unit sales fell.

Apple Inc on Thursday said its earnings in the final three months of previous year set new records, with sales of its flagship iPhone X topping its expectations.

Even though Apple sold fewer iPhones as compared to last year, Apple's revenue is up because of the premium price of the iPhone X. Thanks to the iPhone X, iPhone ASP increased to $796 from $695 a year ago.

But a top analyst told The Sun that the fall in overall iPhone sales can be blamed on the iPhone X. Second-quarter revenue at this level would mark yet another quarter of accelerating growth if it's achieved. Samsung finished the year with 317.3 million shipments, up 1.9 percent from the 311.4 million shipments in 2016.

"We feel fantastic about the results", Cook said in a conference call with analysts.

More worrisome is that Apple's guidance for fiscal Q2 showed revenue well below the consensus estimate of Wall Street analysts, seeming to lend credibility to recent supply chain reports that Apple is slashing production for the iPhone X because of slowing demand.

Apples latest quarter report is out for the Holiday Season.

For Q2 2018, Apple is projecting revenue of $60 billion compared to $51.5 billion a year previously.

Services and other products - which include the App Store and Apple Watch - remained strong, growing 18 per cent and 36 per cent, respectively, from a year earlier.

Following that launch, Apple now says that it counts 1.3 million iOS active devices worldwide as of this January. It speaks volumes about Apple's customer loyalty. The higher price tags helped Apple's total revenue jump 13% - more than analysts had expected. The same quarter past year did fewer iPads (13 million), and slightly more Macs (5.4 million). Apple said it plans to reduce its net cash position of $163 billion to "approximately zero", which means shareholders could potentially see some or all of that money returned to them in the form of dividends or buybacks. The phone's price was apparently a significant factor for revenue in the December quarter.

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