Apple shares rose in the pre-market after the iPhone maker announced strong quarterly results that beat analyst expectations, with iPhone sales propelling revenue higher.
Apple recorded quarterly revenue of $111.2 billion, up 17% compared to the same period a year ago. Analysts has predicted revenue of $109.66 billion.
Diluted earnings per share came in at $2.01, up 22%.
In recent years, sales of new iPhone releases haven’t been as strong as many investors would like to see, but the release of the 17 series has delivered this time around.
“iPhone achieved a March quarter revenue record, fueled by such extraordinary demand for the iPhone 17 lineup,” said Tim Cook, Apple’s CEO.
“During the quarter, Services achieved yet another all-time record, and we were excited to introduce remarkable new products to our strongest lineup ever. That included the addition of the iPhone 17e and the M4-powered iPad Air, along with the launch of MacBook Neo, which is captivating customers all around the world.”
While investors will be encouraged by recent iPhone sales, they may be more excited about what’s to come. For a plethora of reasons, Apple has fallen behind in the AI race. But this could all be about to change with Tim Cook’s departure and a new chapter for Apple that focuses more on AI.
“Apple’s long-awaited iPhone upgrade cycle is in full swing, and AI isn’t even part of the story yet,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.
“The headline numbers were strong, but the real message was in the guidance, which pointed to 14-17% revenue growth at the group level, against pre-results expectations closer to 9%, and even that comes with supply constraints clipping the wings a little.
“This is the power of Apple’s ecosystem in full view: even with an AI experience that has been more disappointment than differentiator, the brand still has enough pull to drag loyal consumers back into the upgrade cycle after years of stretching out their old devices.
“That brand power has bought Apple time, but loyalty won’t last forever, and the next leg of the story now rests on whether John Ternus can turn AI from a weak spot into a reason to go out and grab the latest devices.”