Apple Watch, AirPods and services are Apple's big winners, not the iPhone


Apple focused on the camera when promoting iPhone 11 and iPhone 11 Pro this year.

Angela Lang / CNET

Apple is having a busy holiday this year. Over the past month, the new $ 699 iPhone 11 and $ 999 iPhone 11 Pro announced the $ 4.99 per month Apple Arcade subscription package I'm launching the much-awaited Apple TV Plus video service for $ 4.99 . Add all that the new $ 249 AirPods Pro headphones Apple also announced this week, and there are many new things from the Cupertino tech giant to choose from.

Now the question is if anyone wants to buy them all.

So far, signs of "most of it."

Apple on Wednesday said it raised $ 64 billion in revenue over the three months ended September 28, up nearly 2% from the same time last year. It was also above the $ 62.9 billion on average analysts had expected, according to studies by Thomson Reuters.

"We concluded a groundbreaking fiscal 2019 with our highest Q4 revenue ever, driven by accelerating growth from Services, Wearables and the iPad," said Apple's CEO Tim Cook in a statement. He added that he is "very optimistic about what the holiday quarter has in store."

That was enough to help increase Apple's shares nearly 2% to $ 247.65 apiece in demand. The company is currently valued at more than $ 1.1 trillion, making it one of the most valued ever.

Much of Apple's brilliance during the quarter came from portable devices such as $ 399 Apple Watch and $ 159 AirPods as well as services such as iCloud Photo and Document Storage and the new Apple Arcade. Iphone, meanwhile, did not perform well.

Sales of the iPhone handset, which typically represents about half of Apple's revenue and a large share of its profits, fell nearly 10% to around $ 33 billion. Apple said that customers' interest in the iPhone 11, released September 20 (eight days before the end of the fiscal quarter), was high.

Cook said he was pleased with the iPhone performance, despite the decline in sales. He noted that the decline was less than the 15% decline in the first three quarters. "The significant upturn in demand in the latter part of the quarter is reflected in the overwhelmingly positive reviews, customer feedback and in-store feedback we've seen for this new generation of devices, not to mention a wave of the best images you have." has seen from a smartphone, "he said in a conference call with analysts after the earnings release." We're bullish. "

Apple's positive news and comments that trump non-iPhone successes mark the company's latest effort to step out of the shade The popular iPhone, released in 2007, quickly became the engine of Apple's growth – helping it drive it from $ 24 billion in annual sales to more than $ 260 billion last year.

But that iPhone sales growth has slowed Apple began looking outside the smartphone for its next phase of success.

In March, Cook announced the company's commitment to services publicly, with a flashy press conference announcing Apple TV Plus, Apple Arcade and Apple News Plus, each to be made available for the holidays.

Now, Apple's set to make a case of success already, Apple said it counts 450 million paid subscriptions to their service businesses, up 36% from last year. And, Apple said, it is "well on its way" to the goal of surpassing 500 million subscribers by next year.

For example, Cook noted that Apple's services alone are the size of a Fortune 70 company. And he thinks the Apple Card credit card, made available in the summer, had the most successful launch of a new credit card in the United States ever. To get even more interest in the Apple card, Cook said the company will allow customers to use it to buy a new iPhone for 0% interest over 24 months .

  Apple Airpods Pro

This week Apple announced AirPods Pro, a premium version of its popular AirPods.

Sarah Tew / CNET

Falling Profits, Increasing Sales

When Apple tries to show success outside the iPhone, it still depends on the device for much of the profits. As a result, iPhone's sales decline likely contributed to an overall decline in earnings for Apple as well. Total profits fell to $ 13.7 billion, down about 3% from last year. This is equivalent to $ 3.03 per share, above the $ 2.84 analysts had expected.

For the holiday quarter, Apple said it expects revenues between $ 85.5 and $ 89.5 billion, a midpoint roughly in line with average analyst estimates of $ 86.9 billion.

An analyst, Toni Sacconaghi at Bernstein, asked why the holiday estimates were not higher, given Cook's positive comments.

Apple noted that it introduced major changes to the new iPad Pros and MacBook Air laptops during the holidays last year, which aroused interest in these products. That, along with fluctuations in the financial markets, kept Apple's tension in check.

Another analyst asked about President Donald Trump's trade tariffs with China, which threatened to harm Apple and other technology companies whose devices are designed in the United States, but assembled abroad.

Cook said that Apple is already paying some tariffs today, but overall he is not too concerned about them.

"The tone, I think, has changed significantly," he said, probably referring to trading talks between the United States and China. "And I have long thought that it was in the best interests of both countries to come to an agreement that might not initially solve everything, but solve some things that each party might want and come to a better place than where we are at." 19659030] "I hope that's where we're headed," he added.

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