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Apple Falls in After-Hours Trading as iPhone Sales, Services Miss Estimates (Oct 28, 2022)
Apple Inc reported fourth-quarter diluted earnings per share (EPS) of $1.29 on $90.15 billion of revenue, beating the Bloomberg consensus forecast of $1.26 on $88.63 billion. The iPhone maker’s services revenue rose to $19.19 billion, slightly below the $19.97 billion analysts expected. That was also below the third-quarter services revenue of $19.6 billion and is likely the primary reason the stock is falling in extended-hours trading. Apple increased its price for Apple Music and Apple TV+ recently, which should help to bolster those numbers in the coming quarters.
iPhone sales came in soft at $42.63 billion versus an expected $42.66 billion and up from $40.66 billion in the fiscal third quarter. Wearables, which include EarPods and the iWatch, added $9.65 billion, serving as a bright spot by smashing the $8.8 billion expectation. The company’s performance in China was slightly disappointing, posting $15.47 billion in revenue in greater China.
Mac sales were at $11.5 billion, a healthy beat above the $9.24 billion street estimate and up firmly from $7.38 billion in the third quarter when Mac sales declined more than 10% from the year prior. With consumers feeling the pinch of higher rates, the outlook for discretionary products that make up Apple’s product portfolio is a discouraging one.
