Apple was a dark day for the shareholders and for the entire tech stock index as the largest tech company shared dire earnings.
The company reported steep earnings in the recent quarter and turned its Thursday trading into the worst experience for the shareholders.
Miss on Expectations
The company reported that it badly missed sales, profit, and revenue in the fourth (holiday) quarter. The tech giant reported that most of its business lines met the same fate in the holiday quarter.
According to the company, the sales they generated in the fourth quarter of 2022 were 5% lower than what they generated in the same quarter in 2021.
The company has reported that these are the lowest year-over-year sales the company has generated since 2019.
Statement by Tim Cook
The CEO of Apple, Tim Cook, issued a statement pertaining to the weak performance of the company.
He stated that three factors have ended up impacting the performance of the company.
These factors include the macroeconomic environment. China-based production issues have resulted in a great disruption of the iPhone 14 Pro Max and the iPhone 14 Pro supply chains.
The last factor is the dollar price which has continued to grow stronger, which has impacted Apple’s business.
Tim Cook stated that they are confident that their company will make it out of the difficult times. They will not be hindered much by the two factors except for the macroeconomic environment.
About the macroeconomic environment, Tim Cook stated that it is a factor everyone is talking about. Every person is impacted by the macroeconomic environment and this is something that cannot be fixed easily.
It is a factor that will fix with time so all they can do is hope for the darker clouds to get blown off over time.
The share prices for Apple recorded a more than 4% decline after the statement was made by Tim Cook. Fortunately, the downtrend did not stick around for long as the share prices for Apple, surged before the trading day ended.
The surge was recorded as the tech giant shared its outlook for the ongoing quarter. The company has reported in the earnings outlook that they are not expecting a steep decline in sales as they did in the fourth quarter.
They are confident that their sales have picked up in the ongoing quarter and therefore, their outlook will be promising. However, they do expect that a decline will be witnessed in the ongoing quarter.
Earnings Reported by Apple
Apple has reported that its earnings were not promising for the fourth quarter.
They reported that the earnings for the fourth quarter were $1.88 per share while the estimation was set to $1.94 per share. The year-over-year earnings have recorded a 10.9% dip compared to 2021.
The revenue Apple generated from the iPhone segment was $65.78 billion. The revenue estimation set by the analysts for the particular segment was $68.29 billion.
The year-over-year report shows that iPhone revenue plummeted by 8.17%.
From the Mac segment, the company generated $7.74 billion worth of revenue while the estimation was $9.63 billion. The year-over-year report shows that the revenues have dipped by 28.66%.
The iPad revenue Apple has generated is worth $9.4 billion while the estimation was set to $7.76 billion. The year-over-year increase iPad has experienced is 29.66%.
For other products, the revenue Apple has generated is worth $13.48 billion while the estimation that the analysts set was $15.23 billion. The company has recorded an 8.3% YoY decrease in particular revenues.
The services revenue recorded by Apple for the fourth quarter was $20.77 billion against the $20.67 billion forecast. The revenue surged by 6.4% on a year-over-year scale.
The company is yet to provide guidance for the first quarter of 2023. Still, the situation for Apple is not looking good and it may take time until the company makes a comeback.