Apple Inc. (Nasdaq: AAPL) reported a slight decline in fiscal 2023 fourth quarter revenues, compared with a similar quarter last year. However, the tech giant’s top and bottom lines surpassed Wall Street estimates. Apple stated that revenue in the current quarter would be comparable to last year. The market was expecting an upbeat outlook. This triggered a sell-off that took the share price to $176.65, down $0.92, or 0.52%, from its prior close.
The Cupertino, California-based company reported fourth-quarter revenues of $ 89.50 billion, down 0.70% from $90.15 billion in the fourth quarter of fiscal 2022. Notably, the reported figure represents the fourth successive quarterly decline in revenue from the year-ago period.
For the quarter ended September 30, 2023, Apple posted a net income of $22.96 billion, or $1.46 per share, an increase from $20.72 billion, or $1.29 per share, in the quarter ended September 24, 2022.
Analysts surveyed by LSEG (previously Refinitiv) had anticipated the company to report earnings of $1.39 per share on revenues of $89.28 billion.
Segment wise:
- Product revenues fell by 5.10% y-o-y to $67.18 billion.
- Specifically, iPhone revenues rose by 2.70% y-o-y to $43.81 billion and surpassed Bloomberg forecasts of $43.73 billion. Notably, the fourth quarter included only around a week of iPhone 15 sales.
- Mac revenues plunged to $7.61 billion, from $11.51 billion and missed Bloomberg forecasts of $8.76 billion.
- iPad revenues declined by $822 million to $6.44 billion but beat forecasts of $6.33 billion.
- Wearables revenues were $9.30 billion in 4Q 2023 compared with $9.65 in 4Q 2022. Bloomberg analysts had forecast revenues of $9.41 billion.
- Services revenues were $22.31 billion, up 16.30% from last year. Analysts surveyed by LSEG had forecast revenues of $21.35 billion.
For the fourth quarter, Apple’s gross margin stood at 45.20%, versus 44.50% forecast by LSEG.
Apple’s operations in Greater China, its third-largest market, are currently subject to heightened scrutiny due to concerns among investors regarding rising competition from Huawei. Sales in the Greater China region remained relatively stable year-over-year, with Apple reporting revenue of $15.08 billion from the area, encompassing Hong Kong and Taiwan.
Apple refrained from offering specific formal guidance, but the company’s Chief Financial Officer, Luca Maestri, indicated that the upcoming December quarter’s revenue would be in line with the previous year. Apple also pointed out that this year’s December quarter will be one week shorter in duration compared to the previous year.
For the December quarter—the most important quarter for Apple—analysts forecast revenues of $122.98 billion, translating to an annual growth of 5%.
The company ended the fourth quarter with $162.10 billion in cash. Furthermore, Apple’s board has declared a quarterly dividend of $0.24 per share, payable this month. The company also paid $25 billion to investors in the form of share repurchases.
The quarterly earnings beat and unimpressive 1Q 2024 guidance is expected to keep Apple’s stock range-bound in the short term.
The historical price chart indicates that the stock of Apple is ascending after consolidating at the $173 level. The next resistance is anticipated to be only near $187. Additionally, the stock is trading above its 50-day moving average, while the ultimate oscillator is rising toward the bullish zone. Therefore, we anticipate Apple’s share price to turn bullish in the days ahead.
Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
