By
Godfrey Benjamin
March 22nd, 2024
Apple noted that its supply chain will see a further strain in the current quarter as the production operations resulting from the COVID-19 pandemic still lingers.
The shares of American multinational technology company, Apple Inc (NASDAQ: AAPL) is down by 3.65% in the pre-Market today, following the release of the fiscal fourth-quarter earnings report that sees revenue missing estimates. As reported by CNBC, Chief Executive Officer Tim Cook attributed the revenue miss to COVID-19 related manufacturing, but also highlighted the firm’s strong performance overall.
“We had a very strong performance despite larger than expected supply constraints, which we estimate to be around $6 billion,” Cook told CNBC’s Josh Lipton. “The supply constraints were driven by the industry-wide chip shortages that have been talked about a lot, and COVID-related manufacturing disruptions in Southeast Asia.”
Apple reported a revenue record of $83.4 billion, up 29 percent year over year, but Wall Street’s expectations were pegged at $84.85 billion. Earnings Per Share (EPS) came in at $1.24 as expected, and the gross margin of 42.2% was better than the projected 42%.
Apple’s impressive performance was highlighted across all of its product segments. Despite Wall Street’s expectations for the iPhone revenue coming at $41.51 billion, the actual revenue of $38.87 billion is up 47% year-over-year. Services revenue came in at $18.28 billion, up 25.6% year-over-year, while iPad sales raked in a revenue of $8.25 billion, up 21.4%. Mac sales returned revenue of $9.18 billion, and other products brought in $8.79 billion.
“This year we launched our most powerful products ever, from M1-powered Macs to an iPhone 13 lineup that is setting a new standard for performance and empowering our customers to create and connect in new ways,” said Cook. “We are infusing our values into everything we make – moving closer to our 2030 goal of being carbon neutral up and down our supply chain and across the lifecycle of our products, and ever advancing our mission to build a more equitable future.”
Apple Earnings Expectations for Current Quarter
Apple noted that its supply chain will see a further strain in the current quarter as the production operations resulting from the COVID-19 pandemic still lingers. The company said the chip shortages it is bound to experience are for its older devices and not the new generation ones it now powers with its in-house developed chips.
“So we’ve finished about a month of the quarter. The Covid related manufacturing disruptions have improved greatly. The chip shortages linger on,” Cook said.
Despite the broadly anticipated strain, the company’s executives are confident that Apple’s December quarter will be the firm’s largest in terms of revenue in its history. The expected growth is bound to be fueled by the high demand for iPhone 13 sales which the company is unlikely to meet. The Cupertino-based firm sold some of the new high-performance smartphones for a few days before the Fourth quarter ended, and the massive sales ongoing is bound to contribute to a bolstered revenue.