Apple Smashes Expectations With $94 Billion Quarter. Here's How the iPhone Maker Did It. Apple just reported a significant revenue beat for its latest quarter, exceeding analyst expectations.
By Sherin Shibu Edited by Carl Stoffers
Key Takeaways
- Better-than-expected Apple iPhone sales drove record revenue growth in Apple’s latest quarterly earnings report.
- The iPhone maker reported overall revenue of $94 billion, up 10% year-over-year and higher than Wall Street estimates.
- Meanwhile, iPhone revenue was $44.58 billion for the quarter, accounting for most of the increase in overall revenue.
Following Apple's latest results for the fiscal quarter ending in June, Apple CEO Tim Cook called the period "an exceptional quarter by any measure."
With the biggest revenue growth since December 2021, the third-quarter earnings blew past analyst expectations. Apple reported overall revenue of $94 billion, up 10% year-over-year and higher than Wall Street estimates of $89.53 billion.
"Apple is proud to report a June quarter revenue record," Cook said in the report.
What caused the major revenue surprise? Cook credited the development to "double-digit growth in iPhone, Mac and Services" as well as global expansion "in every geographic segment." In other words, certain Apple products are selling better than ever before worldwide.
Apple CEO Tim Cook. Photo by ANGELA WEISS/AFP via Getty Images
According to Apple's financial statement for the quarter, iPhone sales drove the bulk of revenue, bringing in $44.58 billion for the quarter, higher than $39.3 billion at the same time last year and greater than Wall Street expectations of $39.8 billion. The iPhone was the biggest single contributor to Apple's overall revenue, accounting for nearly half of total net sales.
Cook said on an earnings call with analysts following the report that the strong performance of the iPhone category was caused by the "popularity of the iPhone 16 family, which was up strong double-digits year-over-year." He also noted that in the quarter, Apple shipped its three billionth iPhone since the phone's launch in 2007.
The next biggest category was Services, which includes Apple's subscription-based offerings like Apple TV+, iCloud and Apple Music, as well as the App Store and iTunes Store. Services brought in $27.42 billion for the quarter, an increase from $24.2 billion at the same period last year and "an all-time record," according to Cook's statements on the earnings call. He said that the revenue increase was due to double-digit growth in App Store sales.
Meanwhile, Mac revenue grew by $1 billion year-over-year to reach $8 billion, up 15% year-over-year. Cook said on the call that the increase was "largely driven by the strength of the M4 MacBook Air," which Apple released in March with a starting price of $999.
Substantial growth in certain businesses offset drops in others for the quarter. Both the iPad and wearables, home and accessories categories reported year-over-year declines in revenue, with the iPad decreasing from $7.2 billion to $6.6 billion and wearables, home and accessories declining from $8 billion to $7.4 billion.
However, one wearable reached new heights. Cook touted "a June record for upgraders to Apple Watch," with the $399 product reaching its ten-year anniversary during the quarter.
Cook also stated on the earnings call that AI would have an impact on "all" Apple devices.
"AI is one of the most profound technologies of our lifetime," he stated.
Apple is the third most valuable company in the world, with a market value of $3.07 trillion at the time of writing.
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