Apple unveiled its financial results for its first quarter of the fiscal year, running from October to December 2022. The results are mixed: the apple brand records loss in year-over-year revenue, but sets two new records.
The situation in China has affected the production of iPhones
The Cupertino firm was on a titanic momentum since the Covid-19 pandemic, but like other technology companies, it is affected by the multifactorial crisis that affects the sector. Its revenue in its first fiscal quarter was $117 billion, a loss of 5% compared to the same period a year earlier.. It is the first year-over-year drop in sales since 2019but also its second shortfall since August 2017, as sales were more than 3% below expectations.
Apple has notably suffered from the complex situation in China, with the Covid-19 which directly affected its supply chain. Consequently, demand for iPhone 14 Pro and iPhone 14 Pro Max was much higher than supply, directly impacting its sales. They reached $65.7 billion, or a decrease of 8% compared to the previous year. Mac performance also fell, by more than 28% while the global PC market is going through a very difficult period after thriving during the pandemic. Same story for wearables (Apple Watch, AirPods, etc.), which also fell by 8%.
On the other hand, the iPads performed well with a 30% increase thanks to Apple’s strategy: it marketed a mid-range and inexpensive model, then a high-end tablet.
New record set for company services
The apple brand now claims 2 billion devices worldwide, an incredibly strong installed base. ” As we all continue to navigate a challenging environment, we are proud to have the best range of products and services we have ever had, and as always, we remain focused on the long term and working with our values in everything what we do. In the December quarter, we reached an important milestone and are delighted to report that we now have over 2 billion active devices as part of our growing installed base. », said Tim Cook.
The CEO attributes this performance to the high satisfaction and loyalty of the company’s customersas well as a record number of customers switching from competitors to Apple.
This quarter also saw a new record high for Apple’s services.. They generated 20.7 billion dollars, an increase of 6.4% compared to 2021, signing the best result for the branch since its creation. Cloud services, Apple Pay and Apple Card payments, and Apple Music being strong elements of the division.
Apple remains tentative for 2023
Apple declined to give specific forecasts for the current quarter and full year 2023 as a whole, citing the complex and uncertain macroeconomic environment. However, she explained that the production of its iPhones had improved, and that their sales in the second quarter of the fiscal year would experience a less significant decline.
On the other hand, she expects Mac and iPad sales to experience double-digit declines. Services should continue their momentum and therefore grow. The Cupertino firm also recalled that it had not resorted to any wave of layoffs, unlike other big tech.
” We also recognize that the environment in which we operate is challenging. And so we reduce costs. We’re cutting back on hiring, we’re very careful and deliberate about who we hire “Explained Tim Cook, confirming that if it does not part with its staff, the company has slowed down recruitment to deal with the crisis.