Apple beats Street with another record-breaking quarter

Apple today announced financial results for its fiscal 2018 fourth quarter ended September 29, 2018.

The company posted quarterly revenue of $62.9 billion, an increase of 20% from the year-ago quarter, and quarterly earnings per diluted share of $2.91, up 41%. International sales accounted for 61% of the quarter’s revenue.

Services revenue reached an all-time high of $10 billion. Excluding a one-time favorable adjustment of $640 million recognized in the fourth quarter of fiscal 2017, Services revenue grew from $7.9 billion in the fourth quarter of fiscal 2017 to $10 billion in the fourth quarter of fiscal 2018, an increase of 27 percent.

Data Summary:

• iPhone: 46.889 million units, $37.185 billion revenue (0% units, +29% revenue YOY)
• Mac: 5.299 million units, $7.411 billion revenue (-2% units, +3% revenue YOY)
• iPad: 9.699 million units, $4.089 billion revenue (-6% units, -15% revenue YOY)
• Services: $9.981 billion revenue (+17% YOY)
• Other Products: $4.234 billion revenue (+31% YOY)

Services includes revenue from Digital Content and Services, AppleCare, Apple Pay, licensing and other services. Services net sales in the third quarter of 2018 included a favorable one-time item of $236 million in connection with the final resolution of various lawsuits. Services net sales in the fourth quarter of 2017 included a favorable one-time adjustment of $640 million due to a change in estimate based on the availability of additional supporting information. Other Products includes sales of AirPods, Apple TV, Apple Watch, Beats products, HomePod, iPod touch and other Apple-branded and third-party accessories.

Apple’s iPhone average selling price (ASP) for the quarter was $793.

Here’s what Wall Street expected:

• Earnings: $2.78 per share, (Refinitiv consensus estimates)
• Revenue: $61.57 billion, (Refinitiv consensus estimates)
• iPhone sales: 47.5 million, (FactSet and StreetAccount estimates)
• iPhone average selling price (ASP): $750.78, (FactSet and StreetAccount estimates)

“We’re thrilled to report another record-breaking quarter that caps a tremendous fiscal 2018, the year in which we shipped our 2 billionth iOS device, celebrated the 10th anniversary of the App Store and achieved the strongest revenue and earnings in Apple’s history,” said Tim Cook, Apple’s CEO, in a statement. “Over the past two months, we’ve delivered huge advancements for our customers through new versions of iPhone, Apple Watch, iPad and Mac as well as our four operating systems, and we enter the holiday season with our strongest lineup of products and services ever.”

“We concluded a record year with our best September quarter ever, growing double digits in every geographic segment. We set September quarter revenue records for iPhone and Wearables and all-time quarterly records for Services and Mac,” said Luca Maestri, Apple’s CFO. “We generated $19.5 billion in operating cash flow and returned over $23 billion to shareholders in dividends and share repurchases in the September quarter, bringing total capital returned in fiscal 2018 to almost $90 billion.”

Apple is providing the following guidance for its fiscal 2019 first quarter:

• revenue between $89 billion and $93 billion
• gross margin between 38 percent and 38.5 percent
• operating expenses between $8.7 billion and $8.8 billion
• other income/(expense) of $300 million
• tax rate of approximately 16.5 percent before discrete items

Apple’s board of directors has declared a cash dividend of $0.73 per share of the Company’s common stock. The dividend is payable on November 15, 2018 to shareholders of record as of the close of business on November 12, 2018.

Apple will provide live streaming of its Q4 2018 financial results conference call beginning at 2:00 p.m. PDT on November 1, 2018 at www.apple.com/investor/earnings-call/.

MacDailyNews Take: Booyah!

Why the stock dropped in after-hours trading: iPhone unit shares and revenue guidance only slightly above Q118’s all-time $88.3 billion record.

“Shares of Apple fell 4 percent immediately following the release, as the company missed shipment estimates on iPhones and offered light guidance.” – Sara Salinas, CNBC

SEE ALSO:
MacDailyNews presents live notes from Apple’s Q418 conference call – November 1, 2018

21 Comments

  1. The miss on iPone sales estimates would likely sink any other company, but Apple actually made more money. For a company the size of Apple to increase earnings per diluted charge by 41% YoY is unbelievable.

    1. CUPERTINO, California — November 1, 2018 — Apple today announced financial results for its fiscal 2018 fourth quarter ended September 29, 2018. The Company posted quarterly revenue of $62.9 billion, an increase of 20 percent from the year-ago quarter, and quarterly earnings per diluted share of $2.91, up 41 percent. International sales accounted for 61 percent of the quarter’s revenue.

      Yet…down 4%.
      F-ing WS
      Dont get played folks !

  2. AAPL tanks after hour, because Apple missed iPhone sales estimates, but it’s making more money from iPhones than ever before. Hopefully, it’s turning GREEN tomorrow morning.

    1. you said it

      I too made some money from market but I don’t understand it either or can predict it short term . I hold on to aapl through ups and downs because I believe long term it’s ok.

      I believe it’s OK partly because of the financials, like the cash it generates that fuels buybacks. But more so by looking at it’s product lineup and tech behind it. The ‘A’ series chip, eco-system integration, OS software superiority, privacy and security (vs things like Android) are factors nerds get but analysts often ignore.

  3. Fourth consecutive quarter of record revenue and profit, revenue up 20%, profit up 32% YOY. Growth in every geographic segment, record quarter revenue for iPhones, wearables, services, Mac. iPhone 0% units, +29% revenue YOY **and only 10 days worth of iPhone are in that total **.

    And yet, FIT was up 26% today for earning 4 cents a share instead of losing 1 cent. They sold 3.5M units vs 2.7 YOY and ASP increased a whopping 3%.

    That noise you hear is my head banging on the table. And kicking myself for not selling half my options before close.

  4. When will people get the very simple fact that stock prices reflect what people think will happen in the future NOT what has just happened in the past?

    If you can comprehend that, the stock movements make complete sense.

    1. Yes, you are exactly right. The stock market is, quite honestly, legalized gambling.

      And I am not an anti-capitalist nut, nor am
      I some safe-space millennial who has little to no understanding of how the stock and options markets work.

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