Apple’s services notched double-digit revenue growth in the quarter, and management pointed to continued consumer enthusiasm for content, subscriptions and payments.
CEO Tim Cook noted on the earnings call Thursday (Nov. 2) that in services, “We set an all-time revenue record with double-digit growth and ahead of our expectations during the September quarter.”
Services revenues came in at $22.3 billion, up 16% year over year (YoY), with what Cook said were “all-time revenue records” across the company’s App store, advertising and payment services.
Hardware, depending on where you looked, was mixed, and investors sent the shares down 2% in after-hours trading. China’s market declined, as revenues slipped by a bit more than 2% to $15 billion amid macro pressures in the region.
And CFO Luca Maestri noted on the call that revenue in the current quarter would be similar to the levels seen in the fiscal fourth quarter that was just reported.
Revenue from iPhones came in at $43.8 billion, 3% higher YoY and a record for the September quarter.
Mac revenue came in at $7.6 billion, down 34% YoY, as Cook took note of “challenging market conditions as well as difficult compares against the supply disruptions and subsequent demand recapture we experienced a year ago.”
Across wearables, home and accessories revenue came in at $9.3 billion, down from $9.6 billion a year ago.
Maestri said on the call that the total installed base of active devices reached an all-time high across all products and all geographic segments to 2 billion devices.
“Both transacting accounts and paid accounts grew double digits year over year, each reaching a new all-time high,” Cook said. “Also, our paid subscriptions showed strong growth. We have well over 1 billion paid subscriptions across the services on our platform, nearly double the number we had only three years ago.”
As Cook added later in the call, with “$85 billion [in services] in the last 12 month, that’s the size of a Fortune 50 company — significantly bigger than it was just a couple of years ago.”
During the question-and-answer session with analysts, Cook said that looking ahead “pent up demand” for Macs was “filled in the September quarter.”
Elsewhere, management pointed to the continued go-to-market strategy for Vision Pro, and Cook noted, “We have developer labs set up in different parts of the world so that they can actually get their hands on it and are working on apps,” adding, “We’ll be offering demos in the stores, and it’ll be a very different process than the normal ‘grab and go’ kind of process.”
Asked on the call about the potential for artificial intelligence (AI), Cook said AI and machine learning are “fundamental technologies, and they’re integral to virtually every product that we ship.”
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More