[Asia Economy Reporter Joselgina] "The iPhone 12 led the way, followed by the iPad and Mac."
Apple posted quarterly results that far exceeded market expectations. Not only the first 5G smartphone 'iPhone 12' released in the second half of last year, but also key segments such as the iPad and Mac, which saw a surge in demand due to the COVID-19 pandemic, all recorded double-digit growth. Apple decided on a $90 billion share buyback and also plans to increase dividends.
On the 28th (local time), Apple announced that it recorded sales of $89.58 billion in the first quarter of this year (Apple's fiscal 2021 second quarter). This is an increase of 53.7% compared to the same period last year. Earnings per share (EPS) stood at $1.40.
This surpassed all Wall Street consensus estimates compiled by financial information firm Refinitiv. The previously released average market forecast was EPS of $0.99 and sales of $77.36 billion.
Apple recorded double-digit growth in all product categories in the first quarter. Sales of the Apple iPhone, which is considered the main driver of revenue growth, increased by 65.5% year-on-year to $47 billion. Replacement demand suppressed during COVID-19 poured into the iPhone 12, exceeding market expectations ($41.2 billion) again this quarter following last year's fourth quarter. Earlier, Apple CEO Tim Cook had expressed optimism about iPhone 12 sales due to 5G adoption and promotional marketing by mobile carriers.
The iPad segment posted sales of $7.8 billion, showing a remarkable 78.9% growth compared to a year ago. The Mac business, including laptops and desktops, also recorded sales of $6.86 billion, up 70%. This is interpreted as increased demand for laptops and tablets due to the surge in remote work and online classes amid the COVID-19 pandemic.
CEO Cook emphasized, "The 70% increase in Mac sales is the result of using our own M1 chip instead of processors sold by Intel, which extended battery life." Notably, this earnings report does not include the recently unveiled iPad Pro and iMac models, which CNBC reported are expected to drive additional demand.
Sales of other products, including wearable devices such as Apple Watch and AirPods, reached $7.79 billion, a 24% increase year-on-year. During the same period, the services division, including the App Store and Apple TV, grew 26.7% to $16.57 billion in sales.
CEO Cook told CNBC, "We have over 660 million paid subscribers across our platforms," adding, "This is an increase of 40 million from the previous quarter." He expressed concern over recent regulatory actions targeting app market monopolies, saying, "The App Store is an economic miracle," and "It has changed the economic landscape not only in the U.S. but also in several countries."
On this day, Apple announced a $90 billion share repurchase plan. Dividends will increase to $0.22 per share (a 7% cash dividend yield) and are scheduled to be paid on the 13th of next month.
Apple did not provide earnings guidance this time either. Since the spread of COVID-19, Apple has continued this approach citing uncertainty.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
