Apple’s fiscal third-quarter results, which were released on Thursday, exceeded Wall Street estimates for sales and profit but revealed the iPhone maker’s sluggish growth.
Over 3% growth was seen in Apple shares during prolonged trading.
According to Refinitiv estimates, here are the major figures in comparison to what Wall Street anticipated:
- EPS: $1.20 compared to $1.16 expected, an 8% year-over-year decline
- Revenue: $83 billion, up from the expected $82.81 billion and 2% on a yearly basis.
- Revenue from the iPhone increased by 3% year-over-year to $40.67 billion from the expected $38.33 billion.
- Revenue from services was $19.60 billion compared to the projected $19.70 billion, up 14% from the previous year.
- Revenue from other products was $8.08 billion compared to the projected $8.86 billion, an 8% year-over-year decline.
- Mac revenue was $7.38 billion compared to the projected $8.70 billion, a 10% year-over-year decline.
- iPad sales were $7.22 billion compared to the projected $6.94 billion, a 2% year-over-year decline.
- Gross margin: 43.26% versus an anticipated 42.61%
For the quarter, Apple didn’t offer any official guidance. Analysts anticipated the business to provide fourth-quarter projections of $1.31 in profits per share and approximately $90 billion in sales.

“In terms of an outlook in the aggregate, we expect revenue to accelerate in the September quarter despite seeing some pockets of softness,” Tim Cook, CEO of Apple, said to Steve Kovach of CNBC.
In comparison to the same period last year and the March quarter, when Apple’s revenue increased by nearly 8% and 36%, respectively, respectively, throughout the quarter. Cook stated that the performance exceeded his expectations, and CFO Luca Maestri described it as “challenging operating environment.”
As consumers deal with recession fears and decades-high inflation, chipmakers and other computer suppliers have warned that demand for smartphones and PCs is dropping globally. The consumer electronics sector, which includes giants like Apple, may be destined for a period of weak or no development, according to Apple’s modest growth.
Inflation is being felt by the business, but Cook told CNBC that investments will still be made.
“We do see inflation in our cost structure,” Cook said. “We see it in things like logistics and wages and certain silicon components and we’re still hiring, but we’re doing it on a deliberate basis.”
The fact that Apple’s iPhone sales beat Wall Street forecasts suggests that demand for the iPhone 13 models is still robust even halfway through the product’s yearly release cycle. Sales decline as customers await new models, which happens every September when Apple launches new iPhones.
Cook claimed that throughout the quarter, Apple was successful in converting Android users to iPhone owners.
“We had a record level of switchers and saw double digit growth for customers new to iPhone,” Cook said.
Apple’s Services division experienced the fastest growth during the quarter. It includes recurring payments, service charges, warranties, Google search licencing fees, and income from the iPhone App Store.
Although it was down from the 17 percent increase it had in the second quarter and the 27 percent growth it had in the same period last year, services nevertheless saw over 12 percent growth throughout the quarter.
According to Cook, Apple has 860 million active paid subscriptions, including those for apps purchased through the Apple App Store as well as services like Apple Music and iCloud.
Mac sales declined more than 10% year over year and fell short of consensus forecasts. Cook attributed this to tight supply and a strong dollar.
Apple issued a $4 billion to $8 billion sales warning in April, and the company’s website displayed increased shipment delays for various Mac models during the quarter. Cook claimed that the final revenue was less than $4 billion.
Additionally, in June, Apple unveiled new MacBook Air models that did not begin shipping to customers until July. Apple’s best-selling computer is the MacBook Air.
Apple’s iPad saw a 2% yearly fall, but it outperformed weak Wall Street predictions because tablets were one of the product categories experts thought Apple could move away from in the event of a chip shortage. According to Cook, supply issues and a strong dollar were further factors contributing to the iPad’s drop.
Apple’s other product category, which includes accessories like AirPods, watches, and HomePod speakers, experienced an annual loss of over 8% and fell short of Wall Street projections.
Apple’s Greater China business, which also covers Taiwan and Hong Kong, saw a 1% yearly dip to $14.6 billion. Cook claimed that the outcome came despite significant Covid limitations that reduced demand.
Apple’s gross margin was higher than what the company had anticipated in April. Apple’s gross margin was 43.26 percent, higher than the 42 to 43 percent range the company had earlier this year.
Apple reported that it paid out over $28 billion in dividends and share buybacks during the quarter.