Virtually every Apple business grew in every region this quarter—except the iPhone

[Karlston]

Virtually every Apple business grew in every region this quarter—except the iPhone

CEO Tim Cook called the quarter a "blowout" for wearables.

Enlarge / Apple CEO Tim Cook.

Patrick T. Fallon/Bloomberg via Getty Images

Today, Apple reported its Q3 2019 earnings to investors. Overall revenue is up 1% over the same quarter last year, reaching $53.8 billion. Apple CEO Tim Cook framed the report to investors as "a blowout quarter" for wearables, citing strong demand for the Apple Watch and AirPods as well as growth in services as counterbalances to a slight dip in iPhone sales.

 

iPhone revenue declined year over year (YOY) from $26.5 billion to $26 billion, and iPhones now make up less than half of Apple's revenue. Cook attempted to smooth over reactions to the drop, saying, "While this is down 12% from last year’s June quarter, it is a significant improvement to the 17% year-over-year decline in Q2." That previous-quarter decline sparked a plethora of hot takes from press and investors surmising the demise of Apple, despite the fact that the iPhone business alone would still be a Fortune 50 company on its own, even accounting for the decline.

 

Net sales for the iPad were just over $5 billion, and the Mac saw $5.82 billion on strong sales of the recently revised MacBook Air and MacBook Pro. Wearables reached $5.52 billion, while services hit $11.45 billion. Services grew 13% YOY, remaining Apple's biggest positive business story for yet another quarter. Apple claimed 420 million paid subscribers across its various services, indicated that services grew in all the regions the company tracks, and reiterated that it is on track to hit its goal to double services revenue by 2020.

 

While Apple Music and iCloud were not discussed at length during the call with investors, Apple executives boasted of a 50% increase in monthly users of the Apple TV app YOY. They also confirmed that Apple Pay now completes just shy of one billion transactions per month—twice as many as a year ago. In August, the company will introduce the Apple Card, which is likely to boost Apple Pay usage even more.

 

Apple more or less suggested to investors that this was a strong quarter because the numbers undermine pundits' claims that Apple will not be able to make up for slowing iPhone sales with wearables and services. The problem, though, is that the medium-term health of the wearables and services businesses is tied to the success of the iPhone.

 

To undercut that argument, Cook said the active install base for Apple devices is higher than it has ever been this quarter. When asked how the company explains that amidst slowing sales of the flagship hardware product, Cook alluded both to customer loyalty (that is, relatively few users switching to competing platforms) and users in the aftermarket—consumers who bought iPhones second-hand from someone other than Apple. Cook said the company seeks to encourage the aftermarket, because it helps Apple bring its services to customers it might not reach with its pricey first-run products.

 

Apple stock was up 4% in after-hours trading following the call. While this quarter saw a continuation of the narrative from the prior quarter—iPhone dips versus services and wearables growth—expect much more interesting news next quarter. It will be the first to include revenue from the new iPhone models set to be unveiled later this year, as well as the launch of two new services: Apple TV+ and Apple Arcade.

 

 

 

Source: Virtually every Apple business grew in every region this quarter—except the iPhone (Ars Technica)

[steven36]

Annalist  predict the a decline in profits for other hardware  next quarter  for vendors   because of the trade war . Mac sales have picked up because of people leaving windows  because of end of  life for windows 7 . But I'm afraid it want last because things are just going get too expensive to buy  Smartphone sales bubble done popped   already just like PCs did back in 2014  everybody going to buy a smartphone already has 1 ,2 or 3 like they already have PCs .

[Infinite_Vision]

14 hours ago, steven36 said:

Annalist  predict the a decline in profits for other hardware  next quarter  for vendors   because of the trade war . Mac sales have picked up because of people leaving windows  because of end of  life for windows 7 . But I'm afraid it want last because things are just going get too expensive to buy  Smartphone sales bubble done popped   already just like PCs did back in 2014  everybody going to buy a smartphone already has 1 ,2 or 3 like they already have PCs .

 

I think Cook did a good job.  You see what I did there.  He kept profit coming in and kept the company out of debt.  The problem with Cook is that he is stepping in after Steve Job.  That is a big shoe to fill.  Steve Job was an innovator and visionary ahead of his time.  He might not have been the best father or boss but he saw the future.  What's been missing from Apple is new innovation and new market segment.   Job was great at that.  Apple at the moment is mainly improving on existing design and brand name recognition.  Which is not a bad thing.  The problem with the phone segment is that it is getting very crowded and the market is starting to mature.  Phone prices are getting more expensive and it will crash eventually.  The phone industry keep releasing phone every year and there is only so much people that are willing to buy a new one at that price point every year. 

 

Another problem is that Apple does not have a phone on the lower end range like 200 or 300 dollar to compete against Huawei in third world countries.  They can't release a phone at that price point and not lose their high end brand following.  Brands like Samsung are releasing newer spec and tech on Android after testing out the offering from both company.  This is how I feel.  If you're going to be consider the high end premium brand, you have to bring the goods.  You can't let your competitors out run you.  What I like about Apple is their security and privacy features.  If they can improve upon these two categories, they could add more customers especially with the recent hacking.  Built and promote the Iphone on security and privacy and you'll have a winner.     

 

I would like to go back to using their Mac again but the price range is just to crazy.  I don't want to pay an arm and a leg for something that is not as strong as a PC.  I am tempted because of security features.  Why can't I get performance, security, and privacy in one?  And don't try to be do fancy with the setup.  Sometimes nice and simple is good to go with some flare to it.  Back in the day when I was using Clariswork, it was so much simple and fun.  

 

Fun fact:  Steve Job and his co-founder went to India and met with a guru.  Saw that online somewhere and thought it was neat. 

[steven36]

3 hours ago, Infinite_Vision said:

Apple at the moment is mainly improving on existing design and brand name recognition.  Which is not a bad thing. 

The problem with that  is consumers are holding on to their phones longer and upgrading less often, new iPhone launches don’t spur sales in the same way they once did. That’s why Apple has put such a focus on its consumer services.

 

3 hours ago, Infinite_Vision said:

Another problem is that Apple does not have a phone on the lower end range like 200 or 300 dollar to compete against Huawei in third world countries.

Apple want  ever do that iphone is now less than half of Apple's business and example of the way they are is they stop selling there cheaper Mac Book  in favor of Mac  Book pro and Air  dropping the price a little on them . And come to find out , the  only reason there cheaper is because they put a slower and cheaper SSD drive in them so you need to upgrade the drive to get as good as hardware as the older Mac Books . There rumors of them making a higher end MAC Book pro soon. cheaper by Apple just means the product is not as good.  The smart phone market is too fragmented  with cheap Android phones now  and the Linux smart phone is fixing  to come out that blows Apple's pseudo privacy away if you want too pay more for a phone. As far as PCs  the ones with windows have always been the best option even if you don't like Windows 10  the cheapest way to buy  them is with Windows on it and wipe  them and put Linux on it.

 

Apple is for Rich people  . Only reason Apple iphones  done good in the USA in the past  is that most people don't buy phones they lease to own them because phones were too expensive to buy flat out but now inthe  last few years  the cheap phones have flooded the USA  market and only Apple  fan boys buy that  i crap . I never buy Apple products  even when Jobs was alive and never liked none of there software they had for windows ether . Only thing  from Apple  i ever use i pirate witch are Movies and Music and  like everything else they make someone else makes it better, so it  can be replaced  and the only reason i download it is because it's free too me . 

[Infinite_Vision]

I just think the phone segment is fully mature.  There is so many types and style of phone you can get.  We know there are many Operating system for phone but the two major players dominate the game: Android and OS.  I always felt like the Mac Book were under-powered compare to their PC counter part for the same price.  For me, I am a value buyer.  I want more bang for my money.  I don't really care about the aesthetic of the product, I want functionality and ease of use.  Busy.  And yes, I have read about he Linux smart phone.  I will wait and see review first before making the jump if it is any good. 

 

Window 7 was excellent but Window 10 is just trying to be to many things.  I guess it works more for touch screen setup.  Apple does a good job of marketing and that what brands do.  They were the first one to establish the cellphone business and took it up to another level.  I'm talking about it from a marketing standpoint.  Their PR team does a good job or reminding people of that.  Personally, I think they need to up the game a bit because their spec seems to be outdated compare to their competitors.  I think they are being over run by cheaper alternatives in developing countries which people have a little discretionary income.  I wish Samsung kept their OS for their phone because we as consumer need more options.  Competition creates innovation and drives new products. 

[steven36]

On 8/2/2019 at 2:38 AM, Infinite_Vision said:

And yes, I have read about he Linux smart phone.  I will wait and see review first before making the jump if it is any good. 

I wish Samsung kept their OS for their phone because we as consumer need more options.  Competition creates innovation and drives new products. 

They are working  on porting Ubuntu Linux  distros into there phone  now instead of making there own OS . It's called Linux on DeX . (Samsung DeX)

https://www.linuxondex.com/

 

A full desktop OS on a phone is much better than  just another Phone  OS, Something  Microsoft  wanted to do with Windows 10 and failed at.