Tim Cook’s switch to services vindicated in Apple’s latest results
Revenue from services surged 31% to a record $9.2bn in the quarter — good news as smartphone sales fall
San Francisco — Apple’s results confirmed that, while the days of double-digit smartphone industry growth are over, CEO Tim Cook has a plan to withstand the slowdown. The shares gained in late trading on Tuesday after the company reported iPhone sales in line with analysts’ expectations, gave a bullish revenue forecast and highlighted a surging services business. A new $100bn stock repurchase plan and a higher dividend also helped. The numbers show that Cook’s strategy of selling a growing array of services through a base of more than 1.3-billion Apple devices is working. Shipments in the smartphone sector have fallen 2% in the past year, according to Strategy Analytics, so the company has to evolve beyond its reliance on a device that still accounts for more than 60% of revenue. "Slowly but surely, [Apple] is morphing into more than just an iPhone story and is displaying ability to sustain revenue growth irrespective of iPhone trajectory," Amit Daryanani, an analyst at RBC Capital ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.