Apple Q4 2018: 46.8 Million iPhones Sold, $62.9 Billion in Revenue [u]

Apple has announced their 2018 Q4 earnings, selling 46.8 million iPhones with a quarterly revenue of $62.9 billion USD, an increase of 20% year over year. Net income was $14.1 billion.

Apple said international sales accounted for 61% of the quarter’s revenue, while Services revenue hit an all-time high of $10 billion.

“We’re thrilled to report another record-breaking quarter that caps a tremendous fiscal 2018, the year in which we shipped our 2 billionth iOS device, celebrated the 10th anniversary of the App Store and achieved the strongest revenue and earnings in Apple’s history,” said Tim Cook, Apple’s CEO. “Over the past two months, we’ve delivered huge advancements for our customers through new versions of iPhone, Apple Watch, iPad and Mac as well as our four operating systems, and we enter the holiday season with our strongest lineup of products and services ever.”

“We concluded a record year with our best September quarter ever, growing double digits in every geographic segment. We set September quarter revenue records for iPhone and Wearables and all-time quarterly records for Services and Mac,” said Luca Maestri, Apple’s CFO. “We generated $19.5 billion in operating cash flow and returned over $23 billion to shareholders in dividends and share repurchases in the September quarter, bringing total capital returned in fiscal 2018 to almost $90 billion.”

Here is a breakdown of fourth-quarter sales by device:

  • 46.8 million iPhones (+14% YoY); revenue increase of 24% YoY
  • 9.6 million iPads (-16% YoY); revenue decrease of 14% YoY
  • 5.2 million Mac computers (+42% YoY); revenue increase of 39% YoY

Apple’s iPhone average selling price (ASP) during the quarter was $793 USD, a huge increase from $618 USD in the year-ago quarter, and well above analyst estimates of $750 USD.

This quarter included initial iPhone XS and iPhone XS Max sales, along with previous iPhone X sales as well. iPhone XR sales started in October, so they aren’t included in this quarter.

As for its next fiscal Q1 in 2019, Apple is providing the following guidance:

• revenue between $89 billion and $93 billion
• gross margin between 38 percent and 38.5 percent
• operating expenses between $8.7 billion and $8.8 billion
• other income/(expense) of $300 million
• tax rate of approximately 16.5 percent before discrete items

In after-hours trading, shares of AAPL were down as much as 5%.

Apple CEO Tim Cook told Reuters in an interview, foreign exchange rates negatively impacted the company’s sale’s forecast by $2 billion, while also saying they were unsure if they could make enough new products released in recent weeks.

Cook also said there was some “macroeconomic weakness in some emerging markets,” without going into specifics. China was a highlight, however, as revenue increased 16% to $11.4 billion in the country, the fifth straight quarter seeing double-digit growth in the region, explained the CEO.

Apple Chief Financial Officer Luca Maestri told Reuters, “There’s going to be a minimum tax on foreign earnings coming from the new tax legislation” in the United States.

Apple’s full 2018 fiscal year resulted in $265 billion USD in revenue, with profit at $11.91 USD per share, with both numbers beating Wall Street analyst predictions.

…more to follow, refresh for updates