Apple reported its fourth quarter earnings today after the bell, and it was a bit of a strange quarter because, unlike some previous years (including last year), the launch of an iPhone was not included in this quarter’s numbers . The different models of the iPhone 12 will ship in October and November this year instead of September.
CEO Tim Cook proudly announced double-digit year-over-year growth in all product categories except iPhone on the call, but the iPhone matters: Apple’s total revenue grew just 1 percent year-over-year, while iPhone sales rose nearly fell 21 percent.
While the iPhone didn’t help boost profits, Apple did launch other products during that time, including the redesigned iPad Air and two Apple Watches: the Apple Watch Series 6 and the Apple Watch SE. iPad sales were a significant 46 percent year-over-year increase ($6.8 billion in total), and Mac sales were also strong at $9 billion, up 28 percent from the year-ago quarter.
Apple’s increasing emphasis on services is a much-heard story at this point, but it continued in Cook’s remarks to investors on the earnings call. Services increased 16.3 percent year over year to a total of $14.55 billion. That’s more sales than any other product category except the iPhone ($26.44 billion in this bad quarter).
Cook specifically called Apple TV+ a good quarter. To outsiders, the streaming service seemed slow to start this time last year, especially in contrast to the hugely successful Disney+, which launched the service almost at the same time. But Cook spoke positively about Apple TV+ and mentioned the series Ted Lasso as a remarkable success. The sports comedy starring Jason Sudeikis has been praised for its positive, uplifting vibe, and it’s arguably Apple TV+’s biggest hit to date, though Apple hasn’t released as many Apple TV+ viewership numbers as many would like.
Apple also again declined to provide guidance for the next quarter — a practice it and some other companies have adhered to during the pandemic given global uncertainties. Some analysts had thought Apple would return to providing guidance this quarter, but with COVID cases soaring in some regions (including the United States), it seems like it wasn’t in the cards just yet.
That means analysts, investors and other observers have no idea how well Apple expects the iPhone 12 and 12 Pro to sell. Currently, two of the four new iPhone models are already shipping this season, so we’ll see those numbers in the next quarter — which tends to be Apple’s best precisely because of those new iPhone sales.
Apple shares fell about 5 percent in value in after-hours trading as some investors expressed disappointment that the increase in iPad and Mac sales wasn’t enough to make up for the short-term fall in the iPhone. That said, Apple’s reported earnings came close to what analysts expected this quarter.