Apple reported its best fourth quarter sales ever on Thursday, thanks to a record performance from its Services sector, which includes revenue from the App Store, Apple TV+ and Apple Music. At the same time, the tech giant’s quarterly profit took a big hit after Apple paid more than $10.2 billion to resolve a longstanding tax issue in Ireland.
Here are the top-line numbers from Apple’s fourth quarter, which represents its July through September performance:
Revenues: $94.90 billion, a 6% increase from $89.5 billion in 2023. Apple’s Q4 sales topped analyst estimates from Zack’s Investment Research of $94.56 billion.
Net income: $14.74 billion in net income, down 35.9% from last year when the company reported a $23 billion profit.
Earnings Per Share: Apple’s diluted earnings per share of $0.97 were lower than Zack’s estimates of $1.49.
Services Net Sales: Apple’s Services revenue was $24.97 billion, up 12%, and now makes up more than a quarter of the device maker’s overall revenues.
The bulk of Apple’s sales, as usual, stemmed from its products, with nearly $70 billion coming from that sector. Apple’s iPhone sales increased 5.5% year-over-year to $46.22 billion in Q4, despite sluggish sales in the U.S. and China.
Most of Apple’s sales growth stemmed from its European markets, which brought in $2.5 billion more than it did last year, when Q4 sales were $22.46 billion. It’s a tricky market to gauge, though, considering Apple includes sales from India and the Middle East in its European bracket.
During the quarter, Apple paid a one-time income tax charge of $10.2 billion in order to resolve the tax issue with Ireland, which dates to 2016. Excluding the tax hit, Apple’s profit was $25 billion.
Apple CEO Tim Cook, on the company’s earnings call on Wednesday, said it was the company’s best quarter ever in terms of Services growth year-over-year. Cook, as has been the practice with the tech company, didn’t mention how much Apple TV+ contributed to its big Services quarter.
“We have well over 1 billion paid subscriptions across the services on our platform,” Apple CFO Luca Maestri said on the company’s earnings call, “more than double the number we had only four years ago.”
Maestri, in the company’s earnings statement, added the company’s “active installed base of devices reached a new all-time high across all products and all geographic segments.”
AI was a major topic on the earnings call, with analysts asking several questions about Apple’s plans to compete in the increasingly crowded space. Maestri said Apple had already reallocated some “existing resources” to its AI team, and that the “level of intensity that we’re putting into AI has increased a lot.”
Maestri added the company was able to return over $29 billion to shareholders via dividends during the quarter. Wednesday’s earnings call is the last time Apple investors and analysts will hear Maestri talk publicly about the company’s performance, after he announced in August he’d be stepping down in early 2025, following a decade as CFO.
Apple’s stock, about 30 minutes after the company’s Q4 report was released, was down 1% in after hours trading to $225.91 per share.
In August, Apple changed the release strategy for “Wolfs,” its new action-comedy flick starring Brad Pitt and George Clooney, with the movie shifting to a limited release on Sep. 20 before hitting Apple TV+ exclusively a week later on Sep. 27. TheWrap reviewed the movie, which already has a greenlit sequel.
Apple didn’t have much of anything to say about its content business on Thursday, beyond mentioning series like “Shrinking” had recently returned.
On the AI front, Apple was in talks to invest in OpenAI in August, but that ultimately didn’t come to fruition. OpenAI later announced it had raised $6.6 billion in October, in a round led by Thrive Capital that also included Nvidia, Microsoft, Fidelity, and SoftBank, among other investors.
Apple Intelligence, the company’s suite of AI tools that, among other things, summarizes notifications and allows users to remove objects from pictures, launched earlier this week on iPhone, iPad, and Mac.
On the company’s call on Wednesday, Cook said Apple Intelligence will be “rolling out” more features “in the coming months.” The October through December quarter, Cook added, will be “quite a software quarter” for Apple’s AI business.
With the 2024 election looming, Cook was asked by an analyst what Apple planned to do if tariffs changed. Republican nominee Donald Trump, who has proposed a 60% tariff on goods from China and a 20% tariff on everything else, has touted his tariffs proposals at rallies and on “The Joe Rogan Experience.” Cook said he “wouldn’t want to speculate about those sorts of things.”
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