According to Apple CEO Tim Cook, new Apple Intelligence capabilities will give consumers a compelling incentive to purchase new phones.
According to Apple's prediction, the company's new artificial intelligence features will encourage iPhone upgrades in the upcoming months, helping it recover from a sales slowdown that has particularly hurt its China division.
During a conference call on Thursday to discuss the third-quarter results, Chief Executive Officer Tim Cook stated that new Apple Intelligence capabilities will provide consumers a new incentive to purchase phones.
He informed the analysts on the call that "it will be a very key time for a compelling upgrade cycle."
During a conference call on Thursday to discuss the third-quarter results, Chief Executive Officer Tim Cook stated that new Apple Intelligence capabilities will provide consumers a new incentive to purchase phones.
He informed the analysts on the call that "it will be a very key time for a compelling upgrade cycle."
The statements came after third-quarter results that were largely positive but were tarnished by weak sales in China. With a 5% rise to $85.8 billion in revenue during the period ending June 29, Apple resumed growing its revenue. That exceeded the analyst's $84.5 billion projection.
However, sales from China dropped 6.5% to $14.7 billion, falling short of Wall Street's projected $15.3 billion.
In the late trading after the earnings report, the shares fluctuated. In New York, they had gained almost 1% by 6:30 p.m. As of the closing, the stock had increased 13% for the year on investors' optimism that new AI technology would assist increase sales.
However, sales from China dropped 6.5% to $14.7 billion, falling short of Wall Street's projected $15.3 billion.
In the late trading after the earnings report, the shares fluctuated. In New York, they had gained almost 1% by 6:30 p.m. As of the closing, the stock had increased 13% for the year on investors' optimism that new AI technology would assist increase sales.
The China results stoked concerns that Apple is slipping in one of its most significant international markets. The government has restricted the use of foreign technology in certain workplaces, and the corporation faces increased competition in the area. The economic growth in China has also been worse.
Chief Financial Officer Luca Maestri said to Bloomberg Television's Emily Chang, "We feel we are doing quite well within the context of the broader economy, but we do realize it's a very competitive smartphone market."
September Quarter
According to Apple, overall sales for the September quarter will rise at a rate comparable to that of the recently concluded quarter, which suggests a growth of roughly 5%. A 4 percent clip is anticipated by Wall Street. According to CEOs, services will grow by double digits throughout this time.
In the third quarter, earnings per share came in at $1.40, above the $1.35 that experts had predicted. Since many buyers are waiting for the next iPhone to arrive in the fall, the month of June is usually one of Apple's slowest.
The iPhone, Apple's main product, was sold for $39.3 billion. Even though the number was marginally lower than it was a year earlier, Wall Street was pleasantly surprised. The company signaled that it was still uncertain about the unstable smartphone industry three months ago when it refused to project iPhone revenue for the June period.
The iPhone, Apple's main product, was sold for $39.3 billion. Even though the number was marginally lower than it was a year earlier, Wall Street was pleasantly surprised. The company signaled that it was still uncertain about the unstable smartphone industry three months ago when it refused to project iPhone revenue for the June period.
Return of the iPad
The much awaited release of new models helped Apple's iPad business. After a disappointing period for the tablet portfolio, the firm unveiled significant improvements in May. The new devices included a quicker iPad Air model with a larger screen option and a more expensive iPad Pro with an M4 CPU.
The much awaited release of new models helped Apple's iPad business. After a disappointing period for the tablet portfolio, the firm unveiled significant improvements in May. The new devices included a quicker iPad Air model with a larger screen option and a more expensive iPad Pro with an M4 CPU.
The corporation, headquartered in Cupertino, California, recorded a 24 percent increase in revenue from the category to $7.16 billion. That was more than the $6.6 billion expectation. Prior to the June timeframe, Apple had stated that it anticipated double-digit growth for the iPad, which it easily achieved. Some customers and educational institutions have been delaying iPad purchases for several months in anticipation of the new models.
According to Maestri, "roughly half of the customers who bought an iPad were new to the product."
Apple is developing quicker iPad Pro and iPad Air models in addition to the upcoming iPad mini and entry-level iPad models. When they are made available at some point in the upcoming months, it might inspire more updates.
According to Maestri, "roughly half of the customers who bought an iPad were new to the product."
Apple is developing quicker iPad Pro and iPad Air models in addition to the upcoming iPad mini and entry-level iPad models. When they are made available at some point in the upcoming months, it might inspire more updates.
Intelligence from Apple
Additionally, the business debuted Apple Intelligence during the previous quarter, showcasing the new AI tools at its June developer conference. However, it isn't anticipated that the technology—destined for the iPhone, iPad, and Mac—will be made available to consumers until October. Beyond encouraging the market for devices that are compatible, Apple has not yet said how it intends to make money from the features. Furthermore, the technology won't be initially accessible in China.
The App Store, Apple Music, and TV+ streaming platform are just a few examples of the services division's ongoing growth drivers. Sales were $24.2 billion last quarter, a 14% increase.
Additionally, the business debuted Apple Intelligence during the previous quarter, showcasing the new AI tools at its June developer conference. However, it isn't anticipated that the technology—destined for the iPhone, iPad, and Mac—will be made available to consumers until October. Beyond encouraging the market for devices that are compatible, Apple has not yet said how it intends to make money from the features. Furthermore, the technology won't be initially accessible in China.
The App Store, Apple Music, and TV+ streaming platform are just a few examples of the services division's ongoing growth drivers. Sales were $24.2 billion last quarter, a 14% increase.
Wall Street was aiming for somewhat less than $24 billion in services revenue. Regulators, however, are putting pressure on that company to alter the App Store because they believe it to be an anticompetitive force in the market. In the end, that might make it harder for Apple to get money from software downloads and subscriptions.
The beginning of the back-to-school buying season contributed to Mac's 2.5 percent revenue increase to $7.01 billion. That was in keeping with forecasts from Wall Street.
The beginning of the back-to-school buying season contributed to Mac's 2.5 percent revenue increase to $7.01 billion. That was in keeping with forecasts from Wall Street.
Although the M3 chip was added to the MacBook Air laptop in March, Apple hasn't made any significant upgrades to the Mac since the end of last year. When Apple begins switching to the more potent M4 chip later this year, the computer line might benefit. According to Bloomberg News, the business intends to update every Mac model with the new chip, which is better suited for AI activities.
The once-dominant sector of wearables, home goods, and accessories, which includes Beats headphones, HomePods, the Apple Watch, AirPods, and the company's TV set-top box, continued to struggle. Sales for that company came in at $8.1 billion, a decrease of 2.3 percent. That was still better than the estimated $7.8 billion.
The once-dominant sector of wearables, home goods, and accessories, which includes Beats headphones, HomePods, the Apple Watch, AirPods, and the company's TV set-top box, continued to struggle. Sales for that company came in at $8.1 billion, a decrease of 2.3 percent. That was still better than the estimated $7.8 billion.
Apple's most recent smartwatch lineup saw only minimal tweaks, and some models' blood-oxygen capability had to be removed due to a legal issue. Additionally, it has been a few quarters since the business upgraded its AirPods.
However, support is on the way: this autumn, Apple plans to update its entry-level and mid-range AirPods and add larger displays to select watch models.
The impending iPhone 16 series ought to spur demand. Major design modifications won't be included in the new models, though. The business will emphasize support for Apple Intelligence, faster processors, adding an Action button to the entry-level models, and a camera-control button to the most recent Pro models in their marketing pitch for the iPhone 16.
However, support is on the way: this autumn, Apple plans to update its entry-level and mid-range AirPods and add larger displays to select watch models.
The impending iPhone 16 series ought to spur demand. Major design modifications won't be included in the new models, though. The business will emphasize support for Apple Intelligence, faster processors, adding an Action button to the entry-level models, and a camera-control button to the most recent Pro models in their marketing pitch for the iPhone 16.
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