MacDailyNews presents live notes from Apple’s Q317 Conference Call with analysts starting at 5pm EDT/2pm PDT today.

Apple will provide live audio streaming of its Q317 Results Conference Call using Apple’s industry-leading QuickTime multimedia software.

The live webcast will begin at 2pm PDT/ 5pm EDT today here.

Apple today announced financial results for its fiscal 2017 third quarter ended July 1, 2017. The company posted quarterly revenue of $45.4 billion and quarterly earnings per diluted share of $1.67. According to Thomson Reuters, the analysts’ consensus estimates called for revenue of $44.89 billion and EPS of $1.57.

For their fiscal 2017 fourth quarter, Apple guided for revenue between $49 billion and $52 billion.

Live notes from Apple’s Q117 Conference Call in reverse chronological order:

• Apple is very likely to open regular trading at a new all-time high tomorrow!
• AAPL after hours: $159.59, +$9.54 (+6.36%) @ 5:59PM EDT

• End of call.

• Cook: India reminds me of where we were in China several years ago; we are very excited about our opportunities in India

• Cook: I do think we can grow both in iPhone unit sales and market share; the installed base is growing which generates more upgrades; Apple feels good about ability to convince people to switch to iPhone; and in emerging markets [like India], Apple hasn’t even really gotten started

• Cook re next-gen iPhones: We have no comment on anything that’s not announced.

• Customers get on the App Store and start spending and then, in general, tend to spend more over time
• Apple Music is growing very fast as are iCloud storage subscriptions
• Quality and quantity of App Store content continues to improve
• Apple is making it easier for customers outside the U.S. to pay for apps on the App Store
• Services is accelerating because the App Store is seeing an increasing large amount of paying accounts
• Maestri: Our Services business is very broad

• It feels great to get this thing [AR] going at a level that can get so many developers involved
• Cook: AR is big and profound and we will look back someday and marvel at the start of it
• Cook: I could not be more excited about AR and ARKit – just take a look at the early ARKit projects we’re seeing the Web already
• Cook: autonomous systems goes beyond cars and that’s all I want to say about that
• Cook: We are very focuses on autonomous driving systems from a core tech point of view; it’s the “Mother of all AI projects.”
• Cook: Apple original content. We’re currently focused on Apple Music original content. It’s for our own learning and also to give Apple Music subscribers exclusive content. We’ve recently hired two producers of top notch content

• We think China performance will continue to improve and that drives of guidance
• Maestri: We feel very good about the performance of the business right now; Appel Watch and AirPods are doing incredibly well

• Cook hopes/expects to see some loosening of China’s stance on VPN apps in the future
• Cook: We believe in engaging the countries where we do business; se state our point of view in the appropriate ways
• Cook: In every country, we abide by the laws of that country
• Cook: There are VPN apps available in China App Store
• Cook: We were required to remove unlicensed VPN apps from App Store in China; other app stores
• Cook: Central gov’t in China tightened regulations on VPN apps. A license is required

• Cook ducks question about President Trump’s claim that Apple will build 3 “big, beautiful” manufacturing plants in the U.S.
• Cook: 2/3rd of employee base in the U.S. and we’ll have “some things we’ll say about that later in the year.”
• $200 million has already been invested in a Corning plant
• Apple has established a $1 billion (to start) fund for U.S. manufacturing and plants
• Cook: Apple has purchased about $50 billion worth of goods and services from U.S. suppliers
• Cook talks of Swift Playgrounds helping increase developer base
• Cook: Apple could have only been created here in the U.S., so we feel a responsibility to job creation in the U.S.
• Cook: Apple has created 2 million jobs in the U.S. (3/4 of that 2 million are app developers)

• Cook: Outside of China, Android switchers up YOY and helped with Apple’s successful channel inventory reduction during the quarter
• Based on the amount of “iPhone 8” rumors, Cook feels there is a “pause” in iPhone sales; bodes well for pent-up demand
• iPhone upgrade totals for this fiscal year are the highest that Apple’s seen
• Apple sees Tencent as one of Apple’s biggest and best developers; Apple looks forward to working with Tencent even more
• WeChat makes the switching opportunity for Apple even greater
• What Apple sees in mainland China is definitely encouraging
• iPhone held its own
• iPad grew dramatically more than market; Mac grew much more than market; Services grew extremely strongly
• We are very encouraged by the results this quarter; exceeded Cook’s expectations
• Cook: We’re looking very much forward to the product rollouts [to come in 2H 2017]
• Product transitions affect gross margins
• Maestri more difficult memory prices vs. a year ago

• Analysts’ questions begin…

• Apple is providing the following guidance for its fiscal 2017 fourth quarter:
– revenue between $49 billion and $52 billion
– gross margin between 37.5 percent and 38 percent
– operating expenses between $6.7 billion and $6.8 billion
– other income/(expense) of $500 million
– tax rate of 25.5 percent
• Apple repurchased 30.4 million Apple shares for about $4.5 billion in the quarter.
• New record of $261.5 billion in cash and marketable securities
• Apple Stores now total 497 locations worldwide
• Maestri reviews U.S. schools deploying Apple iPads and other products

• AAPL after hours: $159.40, +$9.35 +6.23%) @ 5:22PM EDT

• SAP app for human resources will support 45 million users worldwide
• New Cisco partnership ads to enterprise security; will make cyber insurance more attainable to businesses
• Walmart to deploy over 19,000 iPads to train associates across the U.S.
• iPad customer sat. ranges from 95-99% across all models
• iPad had 55% share of U.S. tablet market; 89% share of tablets prices over $200
• iPad within Apple’s channel inventory target range
• Mac within Apple’s channel inventory target range
• MacBook Pro is a strong performer (97% customer sat.)
• Apple Pay is by far the #1 NFC payment service on mobile devices with over 90% of transactions worldwide
• App Store generates nearly twice the revenue of Google Play
• In the U.S. (451 Research) 95% customer sat. for iPhone 7 and 99% customer sat. for iPhone 7 Plus
• Apple very pleased with iPhone results, especially since it was a tough compare (Apple launched iPhone SE)
• Apple now has lowest iPhone channel inventory in over 2 years
• Luca Maestri reviews financials…

• Cook: Apple might even have some more innovations to share with you later this year
• HomePod has strong home automation capabilities
• HomePod coming this year with astounding audio quality – unlike any other wireless home speaker on the market
• Apple Watch will become more intelligent than ever with watchOS 4 this fall
• iOS will become the world’s biggest AR platform as soon as iOS 11 ships
• Apple believes AR has broad mainstream applicability
• With ARKit, it’s clear that the imagination of developers has been captured

• Apple very excited about iOS 11, macOS High Sierra, tvOS, and watchOS 4 coming this fall

• Apple has increased AirPods production; still working to meet strong demand
• 98% customer sat. for AirPods
• Apple Watch sales up over 50% YOY in the quarter
• Apple off to a great start to Back to School with newly refreshed Mac portables
• Mac gained global unit marketshare; revenue grew 7% YOY

• iPad sales up 32% YOY to U.S. education purchasers
• iPad unit sales have returned to growth
• Apple achieved highest worldwide tablet marketshare in over four years thanks to new iPads
• Apple Services up strongly – now the size of a Fortune 100 company
• 1.2 billion cumulative iPhone units sold to date
• iPhone 7 was the most popular iPhone. iPhone 7 Plus was up strongly over iPhone 6s Plus
• Apple had a very strong WWDC and the announcements will help delight Apple customers in the coming year
• Apple CEO Tim Cook: Apple is proud to announce every strong results with unit and revenue growth in all of Apple’s product categories

• Start of conference call

• AAPL after hours: $158.15, +$8.10 (+5.40%) @ 4:55PM EDT

• Apple returned $11.7 billion to investors during Q317, bringing cumulative capital returns to nearly $223 billion.

• Other Products revenue: $2.735 billion (+23% YOY) (Other Products includes sales of Apple Watch, Apple TV, Beats products, iPod and Apple-branded and third-party accessories.)
• Services revenue: $7.266 billion (+22% YOY) (Services includes revenue from Digital Content and Services, AppleCare, Apple Pay, licensing and other services.)

• Unit sales:
– iPhone: 41.026 million (+2% YOY)
– iPad: 11.424 million (+15% YOY)
– Mac: 4.292 million (+1% YOY)

• Apple’s Q417 revenue guidance of between $49 billion and $52 billion exceeded expectations, with analysts’ consensus at $49.2 billion

• AAPL after hours: $158.28, +$8.23 (+5.48%) @ 4:45PM EDT
• Apple is trading above its all-time high in after hour trading
• AAPL after hours: $157.65, +$7.60 (+5.06%) @ 4:42PM EDT