Strong sales of the new top-of-the-range iPhone 7 Plus helped technology giant Apple Inc (NASDAQ:AAPL) post better-than-expected fiscal first-quarter sales and earnings, sending its shares 3% higher in post-market trading.
Apple reclaimed the throne as the world's top smartphone seller from South Korean rival Samsung for the first time in five years as it sold 78.29mln iPhones in the quarter, up from 74.78mln the year before, beating analysts’ expectations for 77.42mln.
Apple chief executive Tim Cook said demand was especially high for the larger iPhone 7 Plus in the holidays-dominated period, which includes US Thanksgiving and Christmas.
The strong smartphone sales numbers, which reflected the first full quarter of iPhone 7 sales, helped Apple to report earnings per share of US$3.36 for the three months to December 31, beating estimates for US$3.12.
Apple’s overall revenues rose 3.3% to US$78.35bn, beating analysts’ forecasts for US$77.25bn, while net income was US$17.89bn, albeit down from US$18.36bn at the same stage a year earlier.
Some caution …
But the good mood was slightly tempered by a cautious outlook for the current quarter from the tech giant, which it mainly attributed to a strong US dollar, which impacts overseas revenues.
Reflecting this, Apple's revenue from the Greater China region fell by 11.6% in the first-quarter to US$16.23bn.
The company forecast revenue of between US$51.5bn and US$53.5bn for the current quarter.
Apple is heavily dependent on the success of iPhones, which account for more than two-thirds of its total revenue.
10th anniversary …
Analysts and investors have already set their sights on Apple's 10th-anniversary iPhone this year, which is expected to feature better touchscreen technology, wireless charging and a shift to a higher-resolution display.
Apple is still looking for major new sources of growth as Apple TV struggles to set itself apart from competitors and its plans to enter the autonomous driving market take shape.
The company said Apple Watch sales set a record last quarter, but provided no numbers.
Revenue in the group’s services business - which includes the App Store, Apple Pay and iCloud - jumped by 18.4% to US$7.17bn, helped by the popularity of games, including Pokemon Go and Super Mario Run, and increased revenue from subscriptions.