Apple’s Q1 2018 Earnings Call
Apple’s Q1 2018 Earnings Call occurred on February 1st. Sales were high but iPhone sales slipped at the end of the year. Some think this was due to the high price of the iPhone X. Total iPhone sales were around 77 million units. This is only 1% shy of last year’s first quarter sales.
The call started with Nancy Paxton – Senior Director of Investor Relations. One point mentioned was for investors to keep in mind that the first quarter of 2017 was 14 weeks compared to 1st quarter of 2018 which was 13 weeks. No doubt, an important point to consider when comparing numbers.
Tim Cook – Chief Executive Officer was quick to point out that Apple’s device user-base has expanded to 1.3 billion. This shows 30% growth over the past two years. This is also significant since not only does this mean more devices sold but also more members into the Apple services eco-system.
Turning to the December quarter Tim Cook went on to say, “We’re thrilled to report Apple’s biggest quarter ever, which set new all-time records in both revenue and earnings. We generated revenue of $88.3 billion, which is above the high-end of our guidance range, and it is up almost $10 billion or 13% over the previous all-time record we set a year ago.”
“It’s also our fifth consecutive quarter of accelerating revenue growth with double digit growth in each of our geographic segments around the world. What makes us even more remarkable is that the quarter we’re reporting today was 13-weeks long, while the year ago quarter was 14-weeks. When we look at the average revenue per week in the December quarter this year compared to last year, our growth was a stunning 21%.”
In spite of a number of reports regarding Apple cutting production of iPhone X in half from 40 million to 20 million the financials are looking good over at Apple.
Tim Cook went on to say. “Our growth was broad-based and a key driver was iPhone, which generated its highest revenue ever. iPhone X was the best-selling smartphone in the world in the December quarter according to Canalys, and it has been our top selling phone every week since it launched. iPhone 8 and iPhone 8 Plus rounded out the top three iPhones in the quarter. In fact, revenue for our newly launched iPhones was the highest of any lineup in our history, driving total Apple revenue above our guidance range.”
So why the cut in production of the iPhone X? Perhaps the market share that is willing to spend $1000+ on their new smartphone is not as big as Apple may have hoped for. If Apple has reason to believe this to be true then this is a smart move. Smart moves are what this company is about. They are doing better than ever.
Listen to the entire earnings call here.