Apple first quarter result commentary

Apple yesterday released their first quarter results and a quarterly revenue of $117.2 billion, and while this was a 5% decrease from last year, it was also the second largest quarter in Apple’s history.
Their installed base crossed 2 billion active devices and hit all-time high for all major product categories. Services set a new all-time revenue record.

Highlights 

• $117.2 billion in revenue – the second largest quarter Apple has ever had
• Total profit of $30 billion – also the second-most ever
• Apple now has 2 billion active devices in use, up 150 million from last year – and a doubling of the number from seven years ago
• Second-best iPhone quarter ever – down 8% year over year, but driven by a lack of supply and Apple expects to make up the loss
• iPad revenue grew 30%
• Wearables, Home, and Accessories was also the second-best ever for the category – just not as strong as last year’s
• Services continue to grow and as mentioned, set an all-time revenue record

Details 

• Some markets set all-time revenue records, including Canada, Indonesia, Mexico, Spain, Turkey, and Vietnam, along with quarterly records in Brazil and India
• Operating expenses of 14.3 billion were significantly below the guidance range Apple provided at the beginning of the quarter – meaning they have been able to reduce cost without mass-layoffs
• Transacting accounts and paid accounts grew double digits year-over year, each setting new all-time records
• Apple now has 935 million paid subscriptions, up more than 150 million in 12 months and x4 from five years ago

Finally, I want to quote Tim Cook in full as I thought this put things into perspective very succinctly, he said the below during the financial analyst call which can be listened to in full at that link:

”As a result of a challenging environment, our revenue was down 5% year over year. But I’m proud of the way we have navigated circumstances seen and unforeseen over the past several years, and I remain incredibly confident in our team and our mission and in the work we do every day._ Let me discuss the three factors that impacted our revenue performance during the quarter:_ The first was foreign exchange headwinds, which had a nearly 800 basis point impact. On a constant currency basis, we grew year over year and would have grown in the vast majority of the markets we track._ The second factor, which we described in a November 6th update, was COVID-19 related challenges, which significantly impacted the supply of iPhone 14 Pro and iPhone 14 Pro Max and lasted through most of December. Because of these constraints, we had significantly less iPhone 14 Pro and iPhone 14 Pro Max supply than we planned, causing ship times to extend far beyond what we had anticipated. As we always have every step of the way throughout the pandemic, we continue to prioritize people and worked with our suppliers to ensure the health and safety of every worker. Production is now back where we want it to be._ The third factor was a challenging macroeconomic environment as the world continues to face unprecedented circumstances, from inflation to war in Eastern Europe to the enduring impacts of the pandemic. And we know that Apple is not immune to it. But whatever conditions we face, our approach is always the same: We are thoughtful and deliberate. We manage for the long term. We adapt quickly to circumstances outside our control while delivering with excellence in the things we can. We invest in innovation, in people, and in the positive difference we can make in the world. And we do it all to provide our customers with technology that will enrich their lives and help unlock their full creative potential” – Tim Cook, transcription by Six Colors