Strong gains in iPad and iPhone revenue for the fiscal first quarter paces Apple - PhoneArena

Strong gains in iPad and iPhone revenue for the fiscal first quarter paces Apple

Strong gains in iPad and iPhone revenue for the fiscal first quarter paces Apple
Apple reported its fiscal first quarter 2021 earnings figures just moments ago. As expected, led by its first 5G iPhone models, the company saw a huge surge in handset sales from $56 billion to $65.6 billion. The 17% year-over-year increase in iPhone sales resulted in Apple surpassing Wall Street expectations of $59.8 billion. 

The global pandemic continued to increase demand for the iPad. People continue to work from home using tablets and kids are using the device for remote learning and for entertainment. As a result, iPad revenue for the fiscal first quarter jumped 41% on an annual basis from $5.98 billion to $8.44 billion. Wall Street expected $7.46 billion in gross.

Apple reports double-digit gains in all product categories

Apple's Services unit, which last year generated more than $50 billion in revenue for the first time, is now running at a better than $60 billion rate for fiscal 2021. For the first quarter, Apple's biggest unit had $15.76 billion in sales, up 24% from the $12.72 billion reported during the same quarter last year. Analysts were looking for Apple to announce $14.80 billion in Services revenue for the period. The Wearables, Home and Accessories group, the unit that includes the Apple Watch and the AirPods, took in $12.97 billion in revenue during the quarter; Wall Street was looking for Apple to report revenue of $11.96 billion for the three-months. The actual results topped last year's revenue of $10.01 billion by 29%.

Sales in China were up a strong 57% to $21.31 billion from last year's $13.58 billion. Sales rose on an annual basis for all of Apple's different sales regions including the Americas, Europe, Japan, and the rest of the Asian Pacific market.

Apple CFO Luca Maestri stated, "Our December quarter business performance was fueled by double-digit growth in each product category, which drove all-time revenue records in each of our geographic segments and an all-time high for our installed base of active devices. These results helped us generate record operating cash flow of $38.8 billion. We also returned over $30 billion to shareholders during the quarter as we maintain our target of reaching a net cash neutral position over time."

For the first time ever, Apple generated over $100 billion in sales by reporting gross of $111.4 billion, topping estimates of $103.28 billion. Net income was $28.76 billion or $1.68 per share.That beat EPS forecasts of $1.41 per share and was 34.4% higher than last year's $1.25 EPS number.

Apple CEO Tim Cook commented on the fiscal Q1 results and said, "This quarter for Apple wouldn’t have been possible without the tireless and innovative work of every Apple team member worldwide. We’re gratified by the enthusiastic customer response to the unmatched line of cutting-edge products that we delivered across a historic holiday season. We are also focused on how we can help the communities we’re a part of build back strongly and equitably, through efforts like our Racial Equity and Justice Initiative as well as our multi-year commitment to invest $350 billion throughout the United States." Cook noted that the iPhone's installed base is now over 1 billion units which should help the Services unit continue to grow. Including all devices, Apple's installed base is 1.65 billion units. Talking about the new 5G iPhone models, Apple's CEO said, "They’re full of features that customers love, and they came in at exactly the right time, with where 5G networks were."

Despite the strong quarter (and stronger than expected too) it appears that the stock might have run out of gas. During the regular trading session Apple's shares declined $1.10 or .77% to $142.06 a share. After the report was released, Apple's shares declined an additional $1.01 (or .71%) to $141.05. As it has done since the start of the pandemic, Apple did not give any guidance for the current quarter. Speaking of the pandemic, CEO Cook noted that the virus had kept revenue lower than it might have been. On CNBC the executive said, "Taking the stores out of the equation, particularly for iPhones and wearables, there’s a drag on sales."
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