Apple Profits Decline on Flat Revenues

Posted on October 30, 2019 by Paul Thurrott in Apple with 24 Comments

Apple reported its latest quarterly financial results today, and its revenues rose just 2 percent year-over-year to $64 billion. But its profits fell YOY.

“We concluded a groundbreaking fiscal 2019 with our highest Q4 revenue ever, fueled by accelerating growth from Services, Wearables, and iPad,” Apple CEO Tim Cook said in a characteristically hyperbolic statement. “With customers and reviewers raving about the new generation of iPhones, today’s debut of new, noise-canceling AirPods Pro, the hotly-anticipated arrival of Apple TV+ just two days away, and our best lineup of products and services ever, we’re very optimistic about what the holiday quarter has in store.”

Apple reported net income of $13.7 billion, a decline of 3.1 percent from the year-ago quarter. Its revenues, of $64 billion, were up just 2 percent compared to the year-ago quarter.

Most interestingly, Apple’s iPhone revenues declined, YOY, no doubt due to the lower starting price of its best-selling model, the iPhone 11. Apple reported iPhone revenues of $33.4 billion in the quarter, down 9.2 percent from the $36.8 billion it recorded in the year-ago quarter. But iPhone continues to power Apple’s earnings: The product line contributed 57.5 percent of Apple’s total revenues.

Mac sales were also down YOY, to $6.9 billion, compared to $7.3 billion a year ago.

In the good news department, services sales soared to $12.5 billion, up 15 percent from the $10.6 billion a year ago. Wearable sales were also up, by 35 percent, to $6.5 billion. And iPad sales surged 13 percent to $4.6 billion.

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