Apple posts Q1 2019 revenue of $84.3 billion, net profit of $19.3 billion, misses earnings guidance

There are times when even a net profit of $19.9 billion is below expectations.
Apple on Tuesday announced its Q1 2019 profits, which were decidedly lower than the initial guidance of $89 billion to $93 billion. For the holiday quarter, Apple posted revenue of $84.3 billion and a net profit of $19.9 billion, a 5 percent drop over last year and the clearest sign yet sign that iPhone sales are slowing.
It’s unknown how much Apple’s iPhone units sales fell, as Apple has stopped providing these numbers. During the conference call, Apple CFO Luca Maestri did state that the iPhone XR is Apple’s best-selling phone, and the there are 900 million iPhones in use.

For the holiday quarter, Apple made $52 billion on iPhone sales, compared to $61 billion in the year-ago quarter, a 15 percent drop. Assuming Apple sold fewer iPhones than last year, it’s hard to extrapolate what that means for models and sales.
During an interview with Reuters, Apple CEO Tim Cook stated that Apple is thinking about altering its iPhone pricing policy in foreign markets. At present, Apple sets iPhone prices in terms of U.S. dollars, which often translates to higher prices in these markets. Cook stated that Apple is considering setting the prices to the local currency, which could lower prices in these markets and possibly boost sales.
Elsewhere, Apple made $6.7 billion in iPads sales (versus $5.7 billion last year), and $7.4 billion in Mac sales (an increase over last year’s $6.9 billion). Also on the upswing was Services, which posted revenue of $10.9 billion, a near-$2 billion jump over the year-ago quarter. Apple’s Wearables, Home and Accessories category (previously Other) was also a big performer, earning $7.3 billion compared to $5.5 billion last year—a 33 percent jump.
Cook also stressed that China has become a soft spot for Apple’s current quarter, generating only $13.2 billion during the three months from September to December 2018 compared with $18 billion last year for a more than-25 percent drop.
Cook also stated that “While it was disappointing to miss our revenue guidance, we manage Apple for the long term, and this quarter’s results demonstrate that the underlying strength of our business runs deep and wide.”
Stay tuned for additional details as they become available.
Via Macworld and Reuters