Apple posts blowout third quarter, with sales up 11% despite coronavirus disruptions

Tim Cook, CEO of Apple, speaks during an Apple special event at the Steve Jobs Theater in Cupertino, California, March 25, 2019.

Stephen Lam | Reuters

Apple reported a historically strong quarter for the company on Thursday, including $59.7 billion in revenue and double-digit growth in its products and services segments, blowing away analyst estimates in a period deeply impacted by the coronavirus pandemic. The company also announced it plans to give investors three additional shares of Apple per share they own at the end of August as part of a 4-1 stock split

Apple saw widespread retail closures during the quarter, especially in the United States, but previously touted both work-from-home trends and strong online sales as delivering a boost to overall operations. The company declined to issue guidance for the second quarter in a row, most likely due to uncertainty from the pandemic. 

Here’s how the company did for the quarter ended June 27 compared with analysts’ expectations based on Refinitiv consensus estimates:

  • EPS $2.58 vs. $2.04 est.
  • Revenue: $59.69 billion vs. $52.25 billion est.
  • iPhone revenue: $26.42 billion vs. $22.37 billion est.
  • Services revenue: $13.16 billion vs. $13.18 billion est.

“In uncertain times, this performance is a testament to the important role our products play in our customers’ lives and to Apple’s relentless innovation,” Apple CEO Tim Cook said in a statement. 

Apple’s business is highly seasonal, and its revenue was the highest the company has ever reported in its third quarter, typically the slowest of the year for Apple. Revenue was up nearly 11% year-over-year, and every major product line saw year-over-year growth. Services were up 14.85% year-over-year, and Apple remains on pace to hit its target of $50 billion in services sales this year. 

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Here’s how the company fared by product line, compared with expectations based on Refinitiv consensus estimates:

  • Other Products revenue: $6.45 billion vs. $6 billion est.
  • Mac revenue: $7.08 billion vs. $6.06 billion est.
  • iPad revenue: $6.58 billion vs. $4.88 billion est.
  • Gross margin: 38.0% vs. 38.0% est.

Many of Apple’s products can be very useful to people who are quarantined at home. While iPhone sales only rose 1.66% year-over-year, other product categories saw huge growth. iPad sales were up over 31% and other products, including AirPods and Apple Watch, were up 14.85%. 

Apple’s stock split is the company’s fifth in its history. It previously split on a 7-1 basis in 2014, and a 2-1 basis in 2005, 2000, and 1987. Apple also declared a $0.82 cash dividend payable on August 13. 

This is breaking news. Please check back for updates. 



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