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Apple Q3 2018: 41.3 Million iPhones Sold, $53.3 Billion in Revenue [u]

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Apple has announced their 2018 Q3 earnings, selling 41.3 million iPhones with a quarterly revenue of $53.3 billion USD, an increase of 17% year over year.

The company’s net income was $45.4 billion, an increase of $7.7 billion compared to the year-ago quarter. Apple said international sales accounted for 60% of the quarter’s revenue.

“We’re thrilled to report Apple’s best June quarter ever, and our fourth consecutive quarter of double-digit revenue growth,” said Tim Cook, Apple’s CEO. “Our Q3 results were driven by continued strong sales of iPhone, Services and Wearables, and we are very excited about the products and services in our pipeline.”

“Our strong business performance drove revenue growth in each of our geographic segments, net income of $11.5 billion, and operating cash flow of $14.5 billion,” said Luca Maestri, Apple’s CFO. “We returned almost $25 billion to investors through our capital return program during the quarter, including $20 billion in share repurchases.”

Here is a breakdown of third quarter sales by device:

  • 41.3 million iPhones (-21% YoY); revenue decrease of 21% YoY
  • 11.5 million iPads (+27% YoY); revenue increase of 15% YoY
  • 3.7 million Mac computers (-9% YoY); revenue decrease of 9% YoY

As for its next fiscal Q4 in 2018, Apple is providing the following guidance:

• revenue between $60 billion and $62 billion
• gross margin between 38 percent and 38.5 percent
• operating expenses between $7.95 billion and $8.05 billion
• other income/(expense) of $300 million
• tax rate of approximately 15 percent before discrete items

A cash dividend was declared at $0.73 cents per share, payable on August 16, 2018. Apple’s cash reserve is now $267.2 billion as of Q2.

Apple beat Wall Street estimates and shares are up 2% in after-hours trading. The company’s average iPhone selling price was $724, above analyst expectations.

According to Apple Chief Financial Officer Luca Maestri, he told Reuters these higher selling prices were due to the more expensive iPhone X, which according to the executive was the most popular model in Q3.

He also said numerous company services, such as AppleCare, do not have any strong rivals, noting the latter saw a 27% jump compared to the year-ago quarter; he did not disclose a dollar amount for sales.

Maestri says Apple’s “wearables” category, which includes items such as Apple Watch and AirPods, generated $10 billion in sales over the past 10 quarters, with Q3 seeing a sales jump of 60%.

…more to follow, refresh for updates

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