Apple Inc on Wednesday reported holiday quarter sales and profits that beat Wall Street expectations, as new 5G iPhones helped push handset revenue to a new record and sparked a 57% rise in China sales.
Apple shipped its iPhone 12 lineup several weeks later than usual, but an expanded number of models and new look tapped pent up demand for upgrades, especially in China. The company also posted strong sales of its Mac laptops and iPads in the quarter, driven by consumers working, learning and playing from home during the pandemic.
Apple’s revenue for the quarter ended Dec. 26 rose 21% to $111.44 billion. Earnings per share rose to $1.68 from $1.25, beating Wall Street targets, according to IBES data from Refinitiv. Sales of iPhones were $65.60 billion and beat a record set three years ago.
Chief Financial Officer Luca Maestri told investors that revenue growth was likely to accelerate on a year-over-year basis in the current fiscal second quarter and that gross margins were likely to be similar to the fiscal first quarter’s rate of 39.7%. He also said the company’s services segment revenue faced a tough comparison to the year before, when the pandemic lifted sales, and that year-over-year growth in the company’s wearables segment would slow.
Shares of Apple were down 2.6% at $138.33 in after-hours trade following the report but have risen nearly 12% since Jan. 15. Apple shares rose 85% over the previous year, versus 46% for the Nasdaq 100, of which it is a component.
Apple, the biggest U.S. listed public company by market capitalization with a value of $2.4 trillion, has thrived through a pandemic that forced it to shutter many of its stores but prompted many consumers to buy or upgrade devices.
Apple Chief Executive Officer Tim Cook told Reuters in an interview that the company now has an active installed base of 1.65 billion devices, compared with 1.5 billion devices a year ago. Cook also said Apple now has an installed base of more than 1 billion iPhones, an increase over the 900 million the company most recently disclosed in 2019.
China proved a strong market for iPhone, with overall sales there rising 57% to $21.31 billion.