Apple opened its books, exceeding analyst expectations.
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The US technology group Apple generated slightly more in its second business quarter than in the same period last year, despite the factories closing due to the corona virus pandemic and falling sales in China. The growing service business was able to offset the decline in iPhone sales.
Sales increased 1 percent to $ 58.3 billion in the three months to March 28, with iPhone sales stagnating after Apple closed its stores – first in China and then worldwide. Earnings decreased approximately 3 percent to $ 11.25 billion, or $ 2.55 a share. However, the numbers exceeded the analysts’ revised forecasts, which had expected sales of nearly $ 55 billion. Before the pandemic broke out, market observers had expected sales of more than 63 billion.
The strategic shift of business to selling more software and services paid off. Service revenues increased nearly 17 percent to 13.35 billion in the quarter, more than offsetting the 3.4 percent decline in hardware production such as iPhones, iPads, and Macs. With these products, Apple turned over $ 44.97 billion.
Apple announced it would add $ 50 billion to its ongoing share buyback program. That is less than last year’s $ 75 billion increase. Still, it’s an encouraging sign that Apple wants to return capital to its shareholders, even though buybacks in the U.S. are currently controversial. The quarterly dividend is increased by 6 percent.
Apple compensated for declines in China business with strong sales in the United States and Europe, where closings only started in the last weeks of the March quarter. However, the group may face an unprecedented drop in sales there due to the economic slowdown caused by the pandemic.
The Apple share listed on the NASDAQ gained after the exchange, in official trading it then changes its sign. Most recently, the decline was 1.29 percent at $ 289.95.
By Tripp Mickle
NEW YORK (Dow Jones)
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Image source: Novikov Aleksey / Shutterstock.com, Brendan Howard / Shutterstock.com, Arsenie Krasnevsky / Shutterstock.com, NoDerog / iStock
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