Apple is set to unveil its last earnings report of 2017, and it’s expected to be one of the company’s biggest Q4 results ever.
Wall Street analysts are eager to see how many iPhones Apple sold during the quarter, which included a few days of iPhone 8 and iPhone 8 Plus sales at the end. Apple CEO Tim Cook and CFO Luca Maestri will be hopping on the call with investors at 2 p.m. Pacific today. Naturally, we’ll be here live-blogging all the action.
Come join the fun:
And that’s a wrap. Loads of bullish talk, which I guess is totally appropriate when you crush the numbers like Apple did last quarter (and you’re looking ahead to crushing it even harder next quarter).
Reeling off the list of Apple’s recent successes, Cook says everything is pointing to continued growth and a phenomenal holiday season this year. “Literally, we’re firing on all cylinders,” Cook says.
Responding to a question about the accelerating growth rate of Apple’s services business, Maestri talks about the App Store. It grows on people, he says, and turns into a money machine for Cupertino.
“They tend over time to get more familiar with the store, and they start to spend more,” Maestri says.
Asked how Apple plans to monetize its AR efforts, Tim Cook says the company is just focused on the experience and that revenues will come as a result of having a great product.
“Growing a market like India” is a complicated matter, and you need to execute on all fronts, Cook says. Building stores, building the developer ecosystem, delivering the right types of products at the right price points for the market.
Cook says he sees these things as an opportunity rather than a problem. Building iPhone SE in India for the local market is just one way Apple is cracking that nut.
The question: Those quick-slipping iPhone X ship dates — are they because the phone is super-popular or because supply is super-constrained? And what will sales ultimately look like for the $1,000 super-phone?
Cook says they just sold the first iPhone X, so any kind of “mix discussion” is just an estimate. “We’ve never done this before, so there’s no comparison here,” he says of the three iPhone models and the staggered launch. “So we’re going to learn something.
Cook reiterates his belief that AR is going to be huge — not right now, but in the future. “I think it’s profound, and I think Apple is in a very unique position to lead in this area,” he says.
The iPhone X costs you “less than a coffee a day” explains Cook, trying to justify how the iPhone X is actually affordable if you spread the payments out over 24 months.
Cook defends the “price elasticity” by reminding us that a lot of people buy phones on a monthly basis. You can get a $1,000 phone for the price of “a couple coffees” a month, he says. Don’t know where he buys his coffee, but still, point made.
Still, iPhone 8 Plus got off to the “fastest start” of any iPhone. And Cook says that was a “positive surprise.”
“Obviously I’m not gonna talk about mix,” Cook says. LOL.
Ha ha another question about “the mix.” Here comes the “no comment.”
Cook admits Apple is in unchartered territory, with its wide range of available iPhones (including three separate new models, with the company’s first staggered iPhone launch).
“We’re gonna see what happens,” Cook says, but he promises that Apple execs put their “best thinking” into the guidance they offered for next quarter. And, yes, they remain “bullish.”
Apple’s next product: a real time machine.
Tim Cook is so excited about AR he wants to go back to K-12 for a better education.
“iPhone X orders are very strong for direct partners and our channel partners,” said Tim Cook, “We couldn’t be more excited to get underway.”
There are hundreds of people waiting in front of the Apple store in Sydney and other lines are forming around the globe.
iPhone, Mac and iPad market shares all grew in China during Q4. “The results were broad-based,” Cook says. “They were pretty much across the board.” The Hong Kong decline “moderated,” down some but less than in previous quarters.
Apple won’t say when iPhone X supply will catch up with the insane demand.
“We’re going to get as many of them as posssible to customers as soon as posisble,” said Cook, refusing to speculate on whether supply-demand balance would be met by March 2018.
All this enterprise expansion is definitely good news for Apple. Partnering with big players like GE to get industrial iPhone and iPad apps in the hands of white-collar workers and on factory floors is a big deal. (Oops, that was the last bit before the questions.)
Finally onto the questions from investors. Morgan Stanley is up first…
“Great demand for MacBook Pro” drove Apple’s Mac sales, Maestri says. Just wait till that badass black iMac Pro lands, we say.
Apple has a total of 210 million subscribers across all of its services.
Apple Music revenue grew last quarter and paid subscribers are up 75% year-over-year. Conversions from the free trail period to the paid subscribers are increasing too.
And if you think things are going well right now for Apple, just wait for the 2017 holiday shopping season. “We expect it to be our biggest quarter ever,” Cook says.
Even the Mac and the Apple TV 4K are getting a ton of love in this call. Tim sounds proud of the ever-expanding lineup (and justifiably so).
Apple Watch continues to grow and be the “best-selling and most loved smartwatch in the world,” Cook says. Surprise, surprise — he’s a fan of the LTE version that frees you from your iPhone. Streaming Apple Music from your watch to your AirPods is “magical,” he says.
Apple Watch sales grew 50%. Exactly how many units have been sold hasn’t been revealed though.
There are now over 1,000 AR apps available on the iPhone and iPad.
“AR is going to change everything,” says Cook, from education to shopping and even live sports events.
Apple’s services business is already the size of a Fortune 100 company.
Apple has killed the rumor that the iPhone 7 is outselling the new iPhones. Tim says the iPhone 8 and iPhone 8 Plus have been the most popular iPhones in terms of sales since they launched and have been every week since. That’ll change tomorrow though.
Tim Cook “couldn’t be more excited about Apple’s future.” The company had record sales in pretty much every country.
I’m very curious if they’ll give us those launch-weekend iPhone 8 sales numbers. Seems like a hard phone to sell, what with everybody waiting for the iPhone X (or getting along just fine with an iPhone 7). Suspense!
The live earnings call will start in 5 minutes. You can listen on Apple’s investor website.
Wall Street is loving these numbers right out of the gate. Apple stock is up $5.45, or 3.24 percent, in after-hours trading, per Nasdaq.
Business in China is finally starting to turn around for Apple. The company saw 22% sales growth compared to last quarter and 12% sales growth year-over-year.
This holiday season will likely be Apple’s best ever according to the guidance the company is giving investors. Total revenue estimates are pegged at about $84 billion, meaning Apple expects to sell over 80 million iPhones. The only question is whether the company can make enough iPhone X units to meet demand.
Services brought in more revenue this quarter than ever before. iPad sales were at 10.3 million and 5.4 million Macs were sold, both are an improvement over last year’s Q4 results.
You can read more of the details here.
The results are in and Apple absolutely crushed it. Revenue came in at $52.6 billion which is well above expectations and is 12% higher than the same quarter last year. iPhone sales did slightly better than expected with 46.7 million sold compared to 45.5 million in Q4 last year. Apple sold a total of 216.8 million iPhones during all of fiscal 2017.