Apple Exceeds Expectations in Q4 Earnings Report With Strong Wearable and Services Growth

As we dive into Apple’s latest Q4 earnings report, it becomes clear that the company’s iPhone sales are still a significant contributor to its quarterly revenues. However, they’re slowly losing their grip as other divisions within the company pick up speed.

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Earnings and Revenue Outshine Expectations

Despite some fluctuations in certain segments, Apple’s overall performance was impressive. The company delivered earnings per share of $3.03, surpassing the street’s estimate of $2.84 on revenue of $64 billion compared to expectations of $62.99 billion.

Major Growth Areas: Services, iPad, and Wearables

While iPhone and Mac sales continue to shrink year-over-year, other areas within Apple are experiencing significant growth. Notably:

Services: Up 18% YoY to $12.5 billion
Wearables, Home, and Accessories: Up 54% YoY to $6.52 billion
iPad sales: Up 17% YoY to $4.66 billion

The Shift Away from Unit Sales

As you may recall, Apple no longer reports unit sales for its iPhone, Mac, and iPad lines due to declining unit sales and higher average selling prices. Instead, the company is focusing on revenue growth.

Breakdown of Q4 Revenue:

iPhone: Down 9% YoY to $33.36 billion
Mac sales: Down 5% YoY to $6.99 billion
Services: Up 18% YoY to $12.5 billion
Wearables, Home, and Accessories: Up 54% YoY to $6.52 billion
iPad sales: Up 17% YoY to $4.66 billion

New Opportunities for Growth

Apple is actively exploring new opportunities for growth. The recent release of a high-end set of AirPods will likely boost average selling prices in its wearables division. Additionally, the company’s paid services, including Apple TV+, are on track to launch soon.

The Future of Apple: A Shift towards Services

As Apple continues to navigate the ever-changing tech landscape, it’s clear that the company is shifting its focus towards services and high-growth areas. This strategic pivot positions Apple for long-term success in an increasingly competitive market.