Apple Inc. topped earnings expectations and set a new record for its March-quarter revenue beginning 2022, but executives expect to see additional pressure from challenges in the current period and billions of dollars in additional costs. Shares short in after-hours trading.
Chief Financial Officer Luca Maestri said on a conference call related to Apple’s AAPL, “Supply constraints due to COVID-related disruptions and industry-wide silicon shortages are our ability to meet customer demand for our products. affecting capacity.” +4.52% Earnings Report Thursday.
The company estimates that its June quarter will see an impact of $4 billion to $8 billion in negative impacts related to constraints, which Maestri said was “significantly larger” than what Apple experienced during its March quarter.
While Apple was facing some bite from silicon shortages in the March period, it now faces new challenges from temporary factory closures in China related to the COVID-19 outbreak, Chief Executive Tim Cook said. He expects the pressure to affect “most product categories”, even though some factories have now reopened.
Shares fell 2% after basically moving higher following strong results. Apple beat expectations on both earnings and revenue thanks to particular strength in its iPhone and Mac categories.
The company posted fiscal second-quarter net income of $25 billion, or $1.52 per share, up from $23.6 billion, or $1.40 per share, in the year-ago quarter. Analysts tracked by FactSet were forecasting $1.42 in earnings per share. Apple’s revenue rose to $97.3 billion from $89.6 billion, compared to $94.0 billion analysts were expecting.
Apple generated $50.6 billion in revenue from its iPhone business, up from $47.9 billion a year ago by the FactSet consensus, which accounted for $48.4 billion.
The company saw $7.6 billion in iPad revenue, down from $7.8 billion a year earlier, as well as $10.4 billion in Mac revenue, up from $9.1 billion. FactSet agreed for $7.2 billion in revenue from the iPad and $9.1 billion from the Mac.
Cook said Apple was “continuing to see such strong demand”. [the] The iPad did what it predicted at the start of the quarter, even while navigating significant supply constraints.”
Apple’s wearables, home and accessories category brought in $8.8 billion in revenue, up from $7.8 billion a year ago, compared to what analysts were looking for at $8.9 billion.
The company’s services business grew by $19.8 billion from $16.9 billion a year ago. The FactSet consensus was for $19.7 billion.
Apple executives announced with their latest results that they are adding $90 billion to their stock-repurchase authorization, as well as raising the quarterly dividend by 5% to 23 cents per share. The dividend will be payable on May 12 to shareholders of record by the end of business on May 9.
Apple typically provides updates on its capital-return plans with its March-quarter report, and it has grown to become net-cash neutral over time. When asked whether Apple would consider making a bigger acquisition rather than reducing its cash balance through dividends and buybacks, Cook responded that Apple “would only achieve something that was strategic” but that the company was “always looking.” has been.”
