Apple today beat the Street by announcing financial results for its fiscal 2018 second quarter ended March 31, 2018. The company posted quarterly revenue of $61.1 billion, an increase of 16 percent from the year-ago quarter, and quarterly earnings per diluted share of $2.73, up 30 percent. International sales accounted for 65 percent of the quarter’s revenue.
“We’re thrilled to report our best March quarter ever, with strong revenue growth in iPhone, Services and Wearables,” said Tim Cook, Apple’s CEO. “Customers chose iPhone X more than any other iPhone each week in the March quarter, just as they did following its launch in the December quarter. We also grew revenue in all of our geographic segments, with over 20% growth in Greater China and Japan.”
“Our business performed extremely well during the March quarter, as we grew earnings per share by 30 percent and generated over $15 billion in operating cash flow,” said Luca Maestri, Apple’s CFO. “With the greater flexibility we now have from access to our global cash, we can more efficiently invest in our US operations and work toward a more optimal capital structure. Given our confidence in Apple’s future, we are very happy to announce that our Board has approved a new $100 billion share repurchase authorization and a 16 percent increase in our quarterly dividend.”
Data Summary:
• iPhone: 52.217 million units (vs. 50.763 million units, +3% YOY), $38.032 billion revenue (vs. $33.249 billion, +14% YOY)
• Mac: 4.078 million units (vs. 4.199 million units, -3% YOY), $5.848 billion revenue (vs. $5.844 billion, 0% YOY)
• iPad: 9.113 million units (vs. 8.922 million units, +2% YOY), $4.113 billion revenue (vs. $3.889 billion, +6% YOY)
• Services: $9.190 billion revenue (vs. $7.041 billion revenue, +31% YOY)
• Other Products: $3.954 billion revenue (vs. $2.873 billion, +38% YOY)
“Services” includes revenue from Digital Content and Services, AppleCare, Apple Pay, licensing and other services.
“Other Products” includes sales of AirPods, Apple TV, Apple Watch, Beats products, HomePod, iPod touch and other Apple-branded and third-party accessories.
Thomson Reuters consensus estimates called for revenue of $60.82 billion and $2.67 EPS. Consensus estimates called for 52.54 million iPhone units sold in the quarter (StreetAccount estimate) with and ASP of $741. Fiscal Q3 revenue guidance: $51.61 billion expected by Thomson Reuters consensus.
The Company will complete the execution of the previous $210 billion share repurchase authorization during the third fiscal quarter. Reflecting the approved increase, the Board has declared a cash dividend of $0.73 per share of Apple’s common stock payable on May 17, 2018 to shareholders of record as of the close of business on May 14, 2018.
The Company also expects to continue to net-share-settle vesting restricted stock units.
From the inception of its capital return program in August 2012 through March 2018, Apple has returned $275 billion to shareholders, including $200 billion in share repurchases. The management team and the Board will continue to review each element of the capital return program regularly and plan to provide an update on the program on an annual basis.
Apple is providing the following guidance for its fiscal 2018 third quarter:
• revenue between $51.5 billion and $53.5 billion
• gross margin between 38 percent and 38.5 percent
• operating expenses between $7.7 billion and $7.8 billion
• other income/(expense) of $400 million
• tax rate of approximately 14.5 percent
MacDailyNews Take: All of the iPhone X “concern” was bullshit.
In after hours Nasdaq trading, Apple (AAPL) is up $6.92, +4.09%, to $176.02 per share.
Profit from the painfully gullible. — MacDailyNews, December 26, 2017
SEE ALSO:
Uh, yeah, about those iPhone X ‘concerns’ from analysts: Never mind – May 1, 2018
Apple stock tumbles on one poorly-sourced report of low iPhone X demand – December 26, 2017
Apple and suppliers shares drop on report of weak iPhone X demand – December 26, 2017
Lol hell yeah! Nice!
… and all the ex-spurts got it wrong with their negative predictions and anal-yses….
The ex-spurts got it right. They manipulated the stock correctly to maximize their profits.
The ones that got it wrong were those that sold at $163 (which may have been some gullible ex-spurts).
remember many retail investors close to retirement get burned, their risk tolerance is low
I sympathize with those who get burned by the stock market because their natures compel them to buy high on momentum and sell low on fear. Those people should either hire someone to invest on their behalf or establish and adhere to an objective, logical investment strategy that does not permit emotionalism to drive actions. I recommend no-load, low management fee index mutual funds to nearly everyone as part of a balanced investment strategy. The lack of a load combined with low fees provide an inherent advantage. The index-tracking aspect provides diversification. And an established process of regular contributions and periodic portfolio balancing maximizes an individual’s chances of achieving a reasonable return on investment (ROI).
Individuals cannot match the information access or trading speed of investment companies. They are tied directly into Wall Street and buy or sell before you can even bring your computer out of sleep mode. A pragmatic buy-and-hold strategy is the best approach for the vast majority of individual investors. The more savvy investors can venture into options and sector plays and such, if they choose.
👍👍👍👊👊👊
and 15% divi raise on top too. 😋
16% dividend hike. Not 15%
This, my friends, is a complete and total testament to the mass manipulators that are known as analysts(anal cysts).
100%
… and all the ex-spurts got it wrong with their negative predictions and anal-yses….
so what else in new?
Interesting that Apple specifically points our that iPhoneX was best selling model iPhone every week of the quarter. I find it hard to believe the stories being spread the last few weeks that Apple is killing the X.
I always Laugh Out loud when I hear that ‘Apple is killing the iPhone X’
OF COURSE THEY ARE!!!
Apple releases NEW PHONES Every year!
These BS headlines are just that B.S.
Apple will continue to evolve and innovate the product with new releases every year. The biggest question is what are they going to call it? X.1, XI, 11
Is there going to be a Plus <– always got a kick out of it called the Plus, women hate that connotation in clothing size, you would have thought they would have steered clear of that naming and come up with something more snappy
So what’s the market cap now for AAPL? Seems that the $176/share must have busted the $1T surely?????
Not really. It’s going to take about $192 a share for Apple to break that $1T mark providing the share count stays the same as it is now. Anyway, Wall Street is betting on Amazon to beat Apple to that mark even if it takes a P/E of 400 to do it. If Apple gets to $1T market cap, it will do it with a P/E of around 18 to 19.
Not that anyone cares about Apple when the FANG stocks rule. Wall Street has fallen totally in love with Jeff Bezos and Amazon. Even tRump’s anti-Amazon tweets can’t slow down Amazon’s share gains. It shows that Bezos has more power than POTUS on Wall Street.
As Apple buys back and retires shares, the price per share needed to arrive at $1T increases.
I would have put it..
As Apple buys back shares.. it helps the price per to share increase .
Less slices to the pie.. so each slice (share) is bigger but the pie is still the same size( market cap)
only slices are bigger!
buying shares back does not effect market cap…. or getting to trillion faster. It has no effect on earnings..
In my calculations.. the buy back alone will contribute to aprox 14% gain in stock value.. raising it to 200+ range.. in a about a year or so..
But remember there will be way kess shares.. so cap is not effected.
For cap of trillion add in growth in earnings .. hopefully!!
Stock is way undervalued.
But the trillion mark is still
A trillion= Pe * earnings
Number of shares irrelevant!
Market cap is literally Stock Price x Total Shares Outstanding. PE ratio is Stock Price / Earnings per Share. In both Market Cap and PE the number of shares is essential in the calculation.
I specifically noted ‘retires’ shares since shares bought back by Apple may be used to fulfill vested stock options instead in which case would not reduce the number of Shares Outstanding and result in significantly increasing per share price.
PE ratio is a basic way of comparing how much more (or less) investors ‘trust’ a company’s future prospects. In Apple’s case their low PE may simply represent investors having higher uncertainty due to Apple’s secrecy on future directions.
I think we are having a bit of misunderstanding. the confusion comes from EPS effect i believe.
Lets follow the equations.. i think it will become clear.
First and foremost before anything else :
1) Market cap = PE X EARNINGS . Number of shares is irrelevant .
Also
2)Market cap = Stock price x number of shares .
3)Stock price = earnings / number of shares x PE
Substituting stock price in the 2nd equation.
Market cap=( earnings/ number of share x PE ) / number of shares >>>. Number of shares cancel out in the equation. And we are back to
Market cap= Earnings x PE
Number of shares is irrelavant to market cap.
Its EPS that is effected by number of shares
EPS= Earnings / number of shares . So the more the number off shares .. the less earnings per share…. or the less number of shares the higher earnings per share ( for a given earning ).
Basically same pie size but different slice sizes, depending on how many slices u cut the pie in . But at the end the pie is the same size,( pie is the cap )
As Apple buys shares and retires them.. the number of shares decrease…. so the earnings per share ( eps ) increases. Resulting in higher stock price.
But you have to keep in mind that eventhough the stock price is higher now, there are less shares
Less shares x higher stock price = cap
More shares x lower stock price = cap
Buying stock back helps share price to go up… but has no effect on market cap directly. ( mathematically )
For cap to go up… PE and Earnings have to go up.
Number of shares , mathematically do not effect Earnings or PE .
(Psychologically they may or may not )
Buybacks wont mathematically help Apple cap to reach trillion faster.. but it will help share price…..a way of returning cash to shareholders. ( hopeing PE does not move lower )
Hope this clarifies the issue .
Thank you, that was well reasoned. I think what I am stuck on is that Marketcap on any given day is Stock Price x Shares Outstanding.
PE may have an initial value to calculating Marketcap at IPO but once investors start Stock transactions, Marketcap fluctuates with Stock Price. It is PE that is thereafter affected by Stock Price and not the reverse. As such the number of shares (outside of initial value at IPO) is essential in calculating Marketcap.
The equation then becomes PE = Marketcap / Earnings where at any point in time Marketcap = Stock price x number of shares. As PE being stable/constant is essential in your flow of equations you can see where I have reasoned number of shares being important.
I can see your reasoning if I also agreed that stock price is dictated by PE and not the emotional (or reasoned) buying and selling of Stock.
EPS is altogether a different animal that may inform investors of the attractiveness of a share of stock. Thus prompting a buying or selling of stock, affecting the price and thus back to recalculating Marketshare and PE. EPS alone does not dictate appreciation of Stock value, rather it feeds into calculations to make a decision to buy/sell the stock and may instead depreciate Stock value.
As for Stock buybacks, as long as those shares are retired and not used to fulfill stock options divested by company employees (does not change Shares Outstanding so no EPS change), they do help in raising EPS and the attractiveness of the stock. EPS alone does not drive stock prices up, it is the buying of shares that appear more attractive that does so.
Ditto what MDN said! Screw the naysayers.
I wonder where Michael Blair, the Aapl bear is, these days. He has been REALLY silent, lately!
Fake news by agenda-driven manipulators is so damn common these days, it’s disgusting. The SEC is a huge joke…
Wait wait wait!
Someone, anal surely, will find a narrative to bring this down and everything will crumble again, themn rise slowly to the next quarter. Ten days before, FUD will spur, AAPL will get …. Bla
Rinse, repeat. Sell high, buy low.
Damm! .93 a share = retirement.
I’m looking forward to that 16% increase in dividend to keep paying for all my monthly utility bills. I’m really satisfied with these quarterly earnings. Definitely not as bad as some analysts predicted.
Those crooked analysts are always trying to scam innocent investors with their doom and gloom scenarios. It’s amazing they can sleep at night after causing Apple shareholders to dump their stock using negative supply chain articles. Imagine what Apple stock would be worth if it wasn’t targeted every quarter with negative news articles.
The nonsense about iPhone sales was obvious fake news garbage. At least in the U.S., a super strong economy, rising house prices and a strong employment market should not equal some kind of disaster in iPhone sales. It never made any sense.
The last few weeks of manipulation (stock drop) was initiated by Katy Huberty, on supply chain issues. I was under the impression she stood tall amongst a sea of unethical analysts. I gotta rethink that.
Agree. It became a CW frenzy. It never made any sense. You moved to a better job with higher wages and you could tap your house for $300K at low interest rates, but you can’t afford a phone? Absolute crap.
Money doesn’t talk, it swears. And people can’t spell…
The fine pint says the average selling price of iPhones was lower than last year. Explain how a more expensive phone selling better than the others lowers the ASP?
… would like to thank Tim Cook for his constant vision and his insistence on delivering quality products.
Ugh. The company is on autopilot. It’s nice they keep raking in money, but the results point to slow growth. 2% growth for iPhone, loss for the Mac thanks to poor management.
This is nowhere near the economic boom the trumpanzees promised. Pretty small globally considering Apple is supposed to be making inroads in emerging markets which have 3+ times the rate of economic growth that Apple just reported.
I just wish Cook would leave. There is no impressive hardware innovation pointing to future acceleration of Apple growth. There is no vision pointing to new capabilities Apple can deliver users. It is all about railroading users into subscriptions and “services”.
I can’t stand his empty rhetoric:
“We have the best pipeline of products and services that we’ve ever had.”
“I could not be prouder…”
“… and adding new features soon.”
“In terms of longer term, we’re on target to our goal …”
re consumer data: “We also collect much less data than others do.”
“I continue to believe China is a phenomenal country …”
“We price for the value we’re delivering.”
“We still believe that over time, every phone sold will be a smartphone.”
Whatever. Apple is slower and more bureaucratic than ever. Software and hardware quality no longer stand above the competition. Apple isn’t outpacing the competition in emerging markets and it’s doing a shitty job keeping its core Mac business vibrant anywhere. No, Tim, you’re not delivering new products, you’re increasing prices while dropping features. You’re all in on iOS and subscription based computing and overpriced “other” fashion accessories while dropping critical ecosystem products that users used to love.
It took all of 6 minutes before Tim was bragging how many paid subscriptions Apple had. Next most important thing on his mind was “wearables”. Well goody that you have new watch band colors this year Cook. Who cares how many overpriced poor sounding headphones you push out?
Where are the Macs????? Oh yeah, they declined in sales YoY. What are you going to do about it Cook???? The surprise is that the Macs haven’t dropped worse given Apple’s inability to price them correctly or advertise them.
Cook is actively killing personal computing so they can extract more in subscriptions every day from users, with poor intermittent effort.
Finally, the claim Cook made about the iPhone X topping sales every week is total BS. He’s comparing the X to a specific color/memory configuration of other models. If you compare all minor models of iPhone SE versus 7, 7+, 8, 8+ versus X … the picture tells a very different story. What do you expect, Cook can’t possibly admit that the X was a failure after claiming it’s what Apple is going to produce for the next decade. It’s clear he doesn’t give a shit about personal computing.
To the pottymouths: the analysts correctly pegged this quarter’s earnings very well. It’s a teeny tiny bit better than last year. Nowhere near the massive growth that the dreamers here imagined would rocket Apple past $1T valuation.
Basically this reconfirms that Apple is no longer interested in making a full range of products to empower the end user. It is a corporation, big and bloated, that will decide what features you need and will restrict your choice so you get to pay more for it, thanks to the walled garden. Cook couldn’t be happier to kill off the Mac and everything that made personal computing great in the past.
Investors: it’s not a growth stock anymore. You’ve got an unimaginative beancounter running the show now.
30% yoy growth in earnings is a ” teeny tiny bit ” to you ? … it happens on autopilot ?
Though i have my own frustration, like many here with Apple…. Iphone, Applewatch and Financial performance/managemnet are not some if them …
I think you are trolling a bit.. even going as far as insinuating( totaly baselessly and presumptuously) that Tim is lying on a conferance call to shareholdrrs…
it
a bit too much… Mikie
I am not Mikie.
30% growth in profits is coming from pushing people to subscriptions while hardware continues to get dumbed down. I am not a fan of a company abusing its market power to extract more money while doing nothing to provide a better value to the user. Cook is just collecting money off of Jobs’ products.
Go ahead and roll around in your money. Cook is doing a shitty job setting up Apple with healthy diverse products for the future. Unless of course watch bands and magazines are your idea of future products you want to pay the Apple premium to have.
Nobdy is minding the store while the money comes in. What does Cook’s successor do when the pipeline is revealed for the empty vessel it is?
You are hoplessly presumptuous and deluded
“loss for the Mac thanks to”
The very clear intention to kill the Mac… like the Apple II before it.
“‘impressive hardware innovation”
You’re right, there’s nothing impressive about a phone processor that can beat some current shipping desktop PC processors in benchmarks.
“core Mac business”
LOLOLOL! The Mac hasn’t been core since… well, since the iPhone shipped. They’re neat machines for creating iOS software… do they do anything else? Email maybe?
“Who cares how many overpriced poor sounding headphones you push out?”
Oddly enough, the shareholders…
“everything that made personal computing great in the past.”
Like 40 column green blocky text!!
Please, you kids, get off his lawn!
Boom? I think so, yes.
MacDailyNews: Please now make a list of all the naysayer analysts by name. Publish their headlines and who carried them, causing the stock price to fall. They do this trick every earnings session. Time to call them out!
Great idea. MDN should iCal every manipulative article. Then post it 3,2,1 week(s) before earnings reports.
Get real. Public companies can’t lie on these calls. If they do…..
“All of the iPhone X “concern” was bullshit.”- MDN
But keep talking shit about Tim Cook. Makes perfect sense.
IPhone X can be great and sell well and Cook can still be a visionless caretaker who’s presiding over a significant, measurable decline in software and hardware quality. The two conditions are not mutually exclusive. Jobs left Cook the iPhone heavy train. Cook is riding it.
My point exactly.
I am however willing to say the X hype is bullshit. It’s not the future of iPhones, unless Apple wants to play second fiddle to Samsung innovation for the next decade. At some point Apple is going to have to return to an innovative stance where they are first to market with a product or feature that provides end user value and that NO OTHER COMPANY OFFERS. Haven’t seen that for 7 years now.
The funny thing is. They have been playing the same game before again and again, Playing Apple down. Why still then does the mass even follow their Painfully Inaccurate Guess at all.
With results like that, who needs to spend resources updating those old Macs.
Yeah. And? iPhone X is just the baddest piece of handheld hardware on the frigging planet.