OCT 31 – The latest iPhones have seen “a tremendous response” across the globe, said Apple boss Tim Cook as the tech giant released its latest financial results.
The firm unveiled its thinnest iPhone, the Air, in September, along with upgraded iPhone 17 models, proving a bumper crop for the firm.
It said it expects the upcoming Christmas and New Year’s period to be a blockbuster, forecasting overall revenue to be up to 12% higher than the same period last year.
But Apple narrowly missed estimates for iPhone sales in its fourth quarter that ended in September, which boss Tim Cook blamed on supply constraints for several iPhone models along with a lag in shipments to China.
Despite that, during a call with analysts Mr Cook said Apple is heading into the holiday season “with our most powerful lineup ever”.
The iPhone Air helped entice customers and boost sales.
If the company meets its sales forecast for the holiday season, it would be Apple’s “best quarter ever”, chief financial officer Kevan Parekh told analysts on Thursday.
Apple reported overall fourth quarter revenue of $102.5bn (£77bn), topping analysts’ estimates and representing an 8% increase from the previous year. But iPhone revenue, specifically, came in slightly below expectations at $49bn (£37bn).
Mr Cook stressed that global demand for iPhone 16 and 17 models has been robust, despite constraints that led to the sales miss in the recent quarter.
“We’re not predicting when the supply and demand will balance,” Mr Cook said. “We’re obviously working very hard to achieve that, because we want to get as many of these products out to customers as possible.”
In the Chinese market, he said he “couldn’t be more pleased with how things are going”, citing strong reception to the new iPhone 17.
Data from Counterpoint, a technology market research firm, showed that the first 10 days of iPhone 17 sales in the US and China were up 14% compared with sales of the iPhone 16.
The effects of US President Donald Trump’s tariffs also remain top of mind for Apple’s investors. It manufactures many iPhones in China and its global supply chain leaves it vulnerable to trade wars – though a recent meeting between Trump and President Xi raised hopes for a de-escalation of tensions.
Mr Cook on Thursday told analysts that the company took at $1.1bn (£836m) hit from tariffs in the recently ended quarter. He said the hit will likely amount to another $1.4bn in the holiday quarter as Trump imposes taxes on those whom he sees as “unfavourable” to the US economy.
Amazon, which also reported quarterly results on Thursday, projected sales to land between $206bn (£156bn) and $213bn (£161bn) for the current quarter through December, largely in line with analysts’ expectations.
“We’re encouraged by the start of the peak season,” Brian Olsavsky, Amazon’s chief financial officer, told analysts.
Amazon also said that revenue from Amazon Web Services (AWS), its cloud computing business, rose 20% in the third quarter from the previous year – its fastest pace since 2022.
For investors, that AI-driven growth could come as a reassurance, as Apple faces fierce competition in the race to dominate the AI boom.
Apple’s stock has lagged behind that of rivals Microsoft and Alphabet, both of whom on Wednesday reaffirmed their commitment to spending big on the technology. Those firms have reported even faster growth than Amazon in their cloud computing businesses.
“We continue to see strong demand in AI and core infrastructure, and we’ve been focused on accelerating capacity,” Andy Jassy, Amazon’s chief executive, said in a statement.
By BBC
