Apple Q1 Earnings: Services Growth Offsets iPhone Decline
Key Highlights:
* Revenue: $124.3 billion, up 4% YoY, exceeding expectations
* Earnings: $2.40 per share, a record high, surpassing estimates
* Services revenue: $26.34 billion, a 14% increase
* Mac and iPad sales: Up over 15%, boosting revenue
* iPhone sales: Down 1%, falling short of projections
Details:
Apple's fiscal first-quarter earnings announcement revealed strong growth in its services segment. However, iPhone sales witnessed a decline for the first time since the release of the iPhone 16. Despite the overall revenue growth, the iPhone business missed projections, leading to a slight drop in share prices.
Concern over declining sales in China emerged as factors such as Chinese smartphone market share expansion by competitors like Vivo and Huawei weighed on Apple's Greater China region performance. The region was the only one where Apple experienced a sales drop in Q1 compared to the previous year.
Stock Performance:
Following the earnings release, Apple shares initially declined by 1.5% in extended trading. As of Thursday's close, the stock has lost approximately 5% year-to-date for 2025.
Conclusion:
While Apple's services revenue remains a growth driver, the decline in iPhone sales presents a potential concern for the company's future performance. Investors will closely monitor the ongoing challenges in China and the impact they may have on Apple's overall revenue and earnings outlook.