Apple posted record fiscal third-quarter revenue of $83 billion, up 2% over a year ago, but its profit was down nearly 11%.
Apple cited the economic downturn and supply chain disruptions in China as factors in the quarterly decline in profit.
However, shares were trading up about 3% this morning, at $163, so it can’t be all that bad. Indeed, Apple beat analysts’ revenue expectations thanks in part of higher iPhone sales.
During the quarter, Apple celebrated the 15th anniversary of the iPhone, which continues to grow in popularity. Apple reported iPhone revenue grew 3% year-over-year to a June quarter record of $40.7 billion.
Apple CEO Tim Cook noted during the earnings call that 5G has been an accelerant and 5G penetration globally is still quite low, so there’s reason to be optimistic for future sales.
He also said Apple now has more than 860 million paid subscriptions across the services on its platform, which include those who subscribe to an app in the Apple App Store as well as products like iCloud and Apple Music.
Global smartphone sales declining
Apple ranked second place, with 16% share, in Strategy Analytics’ global quarterly handset tally. Samsung topped the charts with 22% share globally. Rounding out the Top 5 are Xiaomi, OPPO (including OnePlus) and vivo.
Overall, global smartphone shipments are declining. In the second quarter, shipments fell 7%, to 291 million units, mainly due to Covid disruptions and geopolitical issues, according to Linda Sui, senior director at Strategy Analytics.
Apple shipped 48 million iPhones worldwide in the second quarter of 2022, the highest second quarter market share for Apple over the past 10 years – at the expense of Chinese brands that are hampered by the sluggish performance in both home and overseas market, said Woody Oh, director at Strategy Analytics. The firm estimates Samsung shipped about 63 million smartphones during the quarter.
For the full year, the analysts forecast global smartphone shipments to fall 7% to 8% year over year. The economic downturn, price inflation, geopolitical issues, exchange rate volatility and Covid disruption are all contributing factors, Sui said. The situation likely won’t ease until the second half of 2023, she said.