Apple Reports Fiscal 2019 First Quarter Results

All-time records, but a decline in iPhone sales

Earlier today Apple reported their financial results for their fiscal 2019 first quarter ending December 29th, 2018. In other words, the all-important holiday/Christmas sales quarter. They revealed all-time revenue records for services, Macs, and Wearables. But a decline in iPhone sales.

For this quarter Apple has posted quarterly revenue of US$84.3 billion. A decline of 5% from the same quarter a year ago. 62% of this quarters revenue is a result of international sales outside of the US.

Apple has not revealed how many units of a particular product category were sold. Because it is the first earnings report in which they have not done so. But they have specified in the report that their services category, such as iTunes, Apple Music, Apple News, iCloud, and so on – grew 19%. Revenue from Mac and wearables like Apple Watch and Home and Accessories also great at 9% and 33% respectively.

However, iPhone sales took an expected hit, declining 15% from the previous year. Earlier in the month Apple’s CEO Tim Cook revealed in an open letter they saw a slowdown of iPhone sales, particularly in the Chinese market. As a result, it has been reported Apple will look at cutting iPhone prices in International markets, but it is unclear if Australia is one of them.

CEO Tim Cook has this to say on their earnings report:

“While it was disappointing to miss our revenue guidance, we manage Apple for the long term, and this quarter’s results demonstrate that the underlying strength of our business runs deep and wide. Our active installed base of devices reached an all-time high of 1.4 billion in the first quarter, growing in each of our geographic segments. That’s a great testament to the satisfaction and loyalty of our customers, and it’s driving our Services business to new records thanks to our large and fast-growing ecosystem.”

Apple has closed off their earnings report by providing the following guidance for their fiscal 2019 second quarter:

  • revenue between $55 billion and $59 billion
  • gross margin between 37 percent and 38 percent
  • operating expenses between $8.5 billion and $8.6 billion
  • other income/(expense) of $300 million
  • tax rate of approximately 17 percent

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