Despite Apple surpassing Wall Street’s expectations for its third quarter fiscal, there are signs that growth is slowing.
Apple reported Thursday that third quarter revenue was $83 billion with earnings per share (EPS), $1.20. The modest increase in revenue is only 2% year-over-year. However, this comes after Apple posted record revenues of $97.3 billion last quarter and $1.52 in diluted earnings per share.
Yahoo Finance had an average estimate for $1.16EPS and $82.6 billion in revenue. The Q3 results were in line with analysts’ expectations. Apple stock had declined 13% in the previous year before this earnings report. As of this writing, the company’s stock has risen nearly 3% in after-hours trading following its earnings report.
“This quarter’s record results speak to Apple’s constant efforts to innovate, to advance new possibilities, and to enrich the lives of our customers,” said Tim Cook, Apple’s CEO. “As always, we are leading with our values, and expressing them in everything we build, from new features that are designed to protect user privacy and security, to tools that will enhance accessibility, part of our longstanding commitment to create products for everyone.”
The company didn’t break down revenues or subscription numbers for Apple TV+ streaming service. Apple did report that $19.6 billion was generated by its services business. This includes the streaming service and other subscription offers. This is a slight increase of 12% year over year, despite the small miss.
Apple has not released any projections for fourth-quarter earnings since early 2020.
“Our June quarter results continued to demonstrate our ability to manage our business effectively despite the challenging operating environment. We set a June quarter revenue record and our installed base of active devices reached an all-time high in every geographic segment and product category,” said Luca Maestri, Apple’s CFO. “During the quarter, we generated nearly $23 billion in operating cash flow, returned over $28 billion to our shareholders, and continued to invest in our long-term growth plans.”
Coming in to Thursday’s earnings report, analysts have been projecting a revenue slowdown for Apple on the year. Specifically, hardware sales of iPhones, Macs, iPads and other products have been expected to decelerate amid rising inflation, supply chain shortages and rolling lockdowns in China, the company’s second-largest market.
