Apple posts Q3 earnings: Profits jump by 17%

Amid a flurry of seemingly endless iPhone 8 rumors, Apple earlier this afternoon posted its earnings report for the company’s June quarter. When all was said and done, Apple posted revenue of $45.4 billion, an operating profit of $8.7 billion and EPS of $1.67. As a point of comparison, Apple during the same quarter a year ago posted quarterly revenue of $42.4 billion and net income of $7.8 billion, all of which translated to an EPS of $1.42 for the quarter. All told, Apple’s profits, year over year, shot up an impressive 17%.

Putting Apple’s financial performance over the past three months into perspective, analysts on Wall St. were expecting Apple to post revenue in the $44 billion to $46 billion range with EPS projections falling in the $1.57 range. Clearly, it was an impressively solid quarter for Apple.

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Per usual, the most telling aspect of Apple’s earnings report centers on the health of Apple’s iPhone business. That said, iPhone sales for the quarter checked in at 41.02 million units, just a tad higher than the 40.3 million units Apple sold during the year ago quarter.

“With revenue up 7 percent year-over-year, we’re happy to report our third consecutive quarter of accelerating growth and an all-time quarterly record for Services revenue,” Tim Cook said in a press release.”

As for other Apple products, iPad and Mac sales checked in at 11.4 million and 4.2 million, respectively. During the same quarter last year, iPad and Mac sales came in at 9.95 million and 4.25 million. Clearly, the bigger takeaway here is that the iPad line has finally seen some growth after a seemingly endless string of quarters of declining sales. Year over year, iPad sales increased by 15%. Compared to Apple’s March quarter, iPad sales increased by an even more impressive 28%.

Meanwhile, revenue from Apple’s range of services continues to grow. For the quarter gone by, Apple’s services generated $7.2 billion in revenue, representing an impressive 22% increase compared to the same quarter a year ago.

Shares of Apple are up more than 5.5% in after hours trading.

Looking ahead, Apple provided the following guidance for its September quarter:

  • revenue between $49 billion and $52 billion
  • gross margin between 37.5 percent and 38 percent
  • operating expenses between $6.7 billion and $6.8 billion
  • other income/(expense) of $500 million
  • tax rate of 25.5 percent

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