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Apple reported stronger-than-expected earnings and revenue for the fiscal third quarter, driven by a 22% increase in iPhone sales. But the company issued weak guidance for the current period, citing "supply constraints." The stock slid more than 6% in extended trading.
Here's how the company did versus LSEG consensus estimates:
EPS : $2.02, which isn't comparable to analyst estimates of $1.89.
: $2.02, which isn't comparable to analyst estimates of $1.89. Revenue: $109.42 billion, versus $108.65 billion estimated.
Here's how Apple did in other key areas:
iPhone revenue : $54.25 billion vs. $53.86 billion estimated.
: $54.25 billion vs. $53.86 billion estimated. Mac revenue : $10.35 billion vs. $8.74 billion estimated.
: $10.35 billion vs. $8.74 billion estimated. iPad revenue : $6.19 billion vs. $6.92 billion estimated.
: $6.19 billion vs. $6.92 billion estimated. Wearables revenue : $7.88 billion vs. $7.82 billion estimated.
: $7.88 billion vs. $7.82 billion estimated. Services revenue : $30.74 billion vs. $31.22 billion estimated.
: $30.74 billion vs. $31.22 billion estimated. Gross margin : 50.1%. That's not comparable to analyst estimates of 47.9% due to tariff rebates.
: 50.1%. That's not comparable to analyst estimates of 47.9% due to tariff rebates. Cash: $146.52 billion
Net income climbed to $29.79 billion, or $2.02 per share, from $23.43 billion, or $1.57 per share, a year ago. Apple said earnings included 11 cents per share from tariff rebates.
Apple is reckoning with a global memory crunch, or what Cook recently called a "hundred-year flood," and a rush for chip manufacturing capacity that's already forced the company to lift prices on Macs and iPads. Apple hasn't said it will raise prices on iPhones, but many analysts are expecting hikes as soon as this year.
Meanwhile, Apple is gearing up for a launch of a redesigned Siri using Google technology alongside new iPhone hardware in September, a critical test for the company as investors worry that it's fallen behind in artificial intelligence.
Revenue growth in the quarter topped 15% for a third straight period.
It was CEO Tim Cook's last earnings call before handing leadership over to John Ternus, a 25-year Apple veteran and the current head of hardware. Ternus said little on the call.
