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Despite strong Q3 earnings, Apple saw a drop in its stock price following the report. AAPL shares closed at $146.77 or 1.49% down yesterday. After hours, Apple stock lost another 2.09% to reach $143.70.
As many companies are sharing their performance and releasing second-quarter and fiscal third-quarter reports, Apple Inc (NASDAQ: AAPL) has announced its Q3 earnings as well. The tech giant has seen better-than-expected results, crushing analysts’ forecasts.
Apple’s Fiscal Q3 Earnings: Highlights
In the fiscal third quarter that ended on June 26, 2021, Apple reported record revenue of $81.4 billion. In comparison with the same period last year, it is 36% up. Meanwhile, analysts were expecting $73.5 billion.
Further, earnings per share totaled $1.30 vs. $1.01 predicted.
In terms of revenue generated for different types of goods and services that Apple offers, the company has also surpassed expectations. In particular, for iPhone sales, Apple got $39.57 billion vs. $34.01 billion estimated, which is up 49.78% year-over-year. Services revenue totaled $17.48 billion compared to $16.33 billion expected, up 33% year-over-year. Further, Mac revenue of $8.24 billion exceeded analysts’ $8.07 billion and is up 16% year-over-year. As for iPad revenue, it is 12% up this year with $7.37 billion. Apple also generated $8.76 billion from other products. Its gross margin has made up 43.3% vs. 41.9% estimated.
Apple has seen strong sales in different regions, especially China and America. In Greater China, which includes Taiwan and Hong Kong in addition to the mainland, Apple reported a 58% growth in sales from the same quarter last year. In America, sales were up nearly 33% year-over-year.
Apple CFO Luca Maestri commented:
“Our record June quarter operating performance included new revenue records in each of our geographic segments, double-digit growth in each of our product categories, and a new all-time high for our installed base of active devices. We generated $21 billion of operating cash flow, returned nearly $29 billion to our shareholders during the quarter, and continued to make significant investments across our business to support our long-term growth plans.”
Notably, Apple did not provide any guidance and prognosis for its Q3 2021 earnings. The company stopped doing that since the beginning of the COVID-19 pandemic. However, analysts still had their estimates based on previous results.
Apple Stock Declines After Hours
Despite strong Q3 earnings, Apple saw a drop in its stock price following the report. AAPL shares closed at $146.77 or 1.49% down yesterday. After hours, Apple stock lost another 2.09% to reach $143.70. Its market cap is $2.49 trillion. Year-to-date, Apple stock is 10.61% up.
The plunge is probably the result of Apple’s warning about silicon supply constraints that could affect its September quarter iPhone and iPad sales. Notably, the chips that are in short supply are the “legacy nodes” of older chips. The company believes that freight costs for them are high, therefore, there might be issues.