Delay in iPhone 12 sales disguised a huge quarter for Apple

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Delayed sales of the iPhone 12 meant that the fourth quarter tax results Apple reported yesterday was massively better than the figure reported.Apple reported revenue of $ 64.7 billion, which makes it stable from the $ 64 billion the company made in the same quarter last year. But the late availability of this year’s flagship iPhones means the two quarters are not remotely comparable …

The fiscal fourth quarter of last year included initial sales of the iPhone 11 and iPhone 11 Pro. Both were pre-ordered on September 13 and went on sale a week later on September 20. This represents ten days of iPhone 11 sales, compared to not a penny in iPhone 12 sales this year.

Yet despite this, Apple has achieved the same revenue as a year ago. CEO Tim Cook offered a perspective on this during his opening remarks during yesterday’s earnings call, but in a typically underrated fashion.

This quarter, Apple achieved revenue of $ 64.7 billion, a record for the September quarter, despite the anticipated lack of availability of new iPhones during the quarter and the continued impact of Covid-19 , including the closures of several of our points of sale.

We also set a new all-time record for Mac and services. Outside of the iPhone, each of our product categories experienced strong double-digit year-over-year growth, despite supply constraints across multiple product categories.

I say underestimated, because the numbers for everything except the iPhone were incredibly impressive.

Let’s take a look at them, as beautifully illustrated by Jason Snell at Six colors. Sure, iPhone revenue is down 21% year-over-year, but that number doesn’t make sense: it’s the holiday quarter that will reveal the extent of the lag in sales. ‘iPhone 12.

Mac: up 29%.

iPad: up 46%.

Wearables: up 21%.

Services: up 16%.

(See the full set of graphics at Six colors.)

Of course, you can say that this is largely due to the coronavirus crisis. This saw large numbers of people working and studying from home, which drove the demand for laptops and tablets for business and educational use. Locks have also increased demand for home entertainment, which will have helped iPad, HomePod, Apple Music and more. But the fact remains that Apple’s growth in these areas has been significantly better than that of the market as a whole.

Apple could have done even better on Mac: Cook revealed that the company has supply constraints that prevent it from meeting demand.

The market didn’t seem overly impressed: at the time of writing, AAPL is down around 4% in pre-market trading. Partly it’s a disappointment that Apple didn’t offer any guidance for the current quarter, but it was predictable.

It probably reflects the company’s rather muted comments about early iPhone 12 sales as well: CFO Luca Maestri used good words, but only said he expected iPhone revenue “Increase” this quarter, when the market might have expected this statement to be strengthened. with an encouraging adjective or two.

We’ve just started shipping the iPhone 12 and 12 Pro, and we’re off to a good start. We’re also excited to start pre-orders on iPhone 12 mini and 12 Pro Max next Friday. Based on the overwhelmingly positive response, we expect iPhone revenue growth in the December quarter, despite shipping iPhone 12 and 12 Pro four weeks after the start of the quarter and the iPhone 12 mini. and 12 Pro Max seven weeks after the start of the trimester.

Tim Cook later said early indications for iPhone 12 sales were “pretty good.” These words also seemed to lack confidence.

But the reality is that only two models have been released so far. Apple doesn’t yet know what demand for the iPhone 12 mini and iPhone 12 Pro Max will look like, so somewhat cautious language is again not surprising.

I’m not a gambler, but if I was, I would expect the vacation quarter to be dramatic. As Apple itself said, we’re not going to revert to the old normal for some time, which means demand for Macs and iPads will likely remain high. Mac demand is expected to increase significantly when the first Apple Silicon Macs go on sale, which Apple has promised to do this quarter. And, of course, all initial iPhone 12 sales for all four models will arrive this quarter.

This quarter has been much better than the headline figures indicate; the next quarter will be important.

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