Apple unveiled a 16 per cent sales surge to £44.9billion as the iPhone maker became the latest tech giant to beat expectations on Wall Street.
The figure was a pleasant surprise for traders, who had been expecting subdued numbers in the first quarter of 2018, and sent shares up 4 per cent in after-hours trading.
However, the firm sold fewer iPhones than hoped at 52.2m, 300,000 less than market watchers were expecting.
Apple sold fewer iPhones than hoped at 52.2m, 300,000 less than market watchers were expecting
The big surprise was in Apple’s services arm – which includes its music division and app store – where sales grew 31 per cent to £6.7billion.
This operation is likely to be important in future if the business is to continue growing now that it dominates the global mobile market.
The ‘other products arm’, including the Apple Watch and the firm’s new £320 Homepod intelligent speaker, saw growth of 38 per cent to £2.9billion.
Investors were also given a widely expected £73.4billion share buyback. Apple plans to return all of its spare cash to investors over the next few years.
Mobile Sales Letdown
- 52.2m iPhones shipped in the last three months – 300,000 less than expected
- 9.1m ipads sold in the past three months by Apple
- £196.3billion Apple’s cash pile, which fell for the first time since 2016
- 4m Apple Macs sold in the last three months
The results followed speculation about a sharp slowdown in iPhone sales worldwide, as consumers hang onto their devices for longer rather than upgrading every time a new one comes out.
A survey of British consumers by GfK last month found that sales had dropped 11 per cent in the past year.
And a string of iPhone suppliers have issued profit warnings, sparking fears of a difficult performance.
The £1,000-plus iPhone X was launched in November to a muted reception and was seen as more of an incremental improvement on previous models than a must-have which offered a huge change.
It came as social media firm Snap posted a £283million loss in disappointing results for the first quarter of 2018.
The firm – which owns instant photo messenger Snapchat – missed analyst expectations with 191m daily users, up 15 per cent on a year earlier.
And overall revenues were up 54.1 per cent to £169.5million against estimates of £179.6million.
Wall Street reacted with alarm to the figures, sending shares down as much as 16 per cent after markets closed.