Latest news with #KevanParekh
Yahoo
7 days ago
- Business
- Yahoo
Apple revenue forecast beats estimates, tariff costs projected at $1.1 billion
By Stephen Nellis and Akash Sriram SAN FRANCISCO (Reuters) -Apple forecast revenue for the current quarter ending in September well above Wall Street's estimates on Thursday, sending shares up despite a warning from CEO Tim Cook that U.S. tariffs would add $1.1 billion in costs over the period. As the centerpiece of U.S. President Donald Trump's trade war, those tariffs cost Apple $800 million in the June quarter and spurred some customers to buy iPhones in late spring this year. Those purchases helped Apple's fiscal third-quarter sales beat expectations by the biggest percentage in at least four years, according to LSEG. The company still forecast growth, though, with Chief Financial Officer Kevan Parekh saying the company expects revenue growth for the current quarter in the "mid to high single digits," which would exceed the 3.27% growth to $98.04 billion that analysts expected, according to LSEG data. Apple reported $94.04 billion in revenue for its fiscal third quarter ended on June 28, up nearly 10% from a year earlier and beating analyst expectations of $89.54 billion, according to LSEG data. Its earnings per share of $1.57 topped expectations for $1.43 per share. Apple shares were up 3% in after-hours trading, extending gains after Apple provided its forecast. Sales of iPhones, the best-selling product for the company based in Cupertino, California, were up 13.5% to $44.58 billion, beating analyst expectations of $40.22 billion. Apple has been shifting production of products bound for the U.S., sourcing iPhones from India and other products such as Macs and Apple Watches from Vietnam. The ultimate tariff rates many Apple products could face remain in flux, and many of its products are currently exempt. Sales in its Americas segment, which includes the U.S. and could face tariff impacts, rose 9.3% to $41.2 billion. In Greater China, where Apple has faced long delays in approval to introduce AI features on its devices, sales were $15.37 billion, up from a year ago and above expectations of $15.12 billion, according to a survey of five analysts from data firm Visible Alpha. That gain was a turnaround from a year-over-year decline in China sales in the March quarter. In a conference call with analysts, Cook said some of that was due to a subsidy program in China to help revive the smartphone market, which boosted some of Apple's products. "It was the first full quarter of the subsidy playing out," Cook told analysts. EARLY PURCHASES In an interview with Reuters, Cook said the company set seasonal records for upgrades of iPhones, Macs and Apple Watches. He said Apple estimates about 1 percentage point of its 9.6% of sales growth in the quarter was attributable to customers making purchases ahead of potential tariffs. "We saw evidence in the early part of the quarter, specifically, of some pull-ahead related to the tariff announcements," Cook told Reuters, though he also said the active user base for iPhones hit a record high in all geographies. The U.S. is still negotiating with both China and India, with Trump saying India could face 25% tariffs as early as Friday. However, analysts said India could still retain cost advantages for Apple in the longer term. "The pull-forward in demand due to tariffs was somewhat expected given the uncertainty around pricing. However, it's important to put this in context as this is typically a slow quarter for Apple, yet they still delivered exceptional results with iPhone growth," Emarketer analyst Jacob Bourne said. Tariffs are only one of Apple's challenges. The company faces competition from rivals such as Samsung Electronics Co in a tough market for premium-priced mobile phones. On the software front, Apple faces challenges from Alphabet, which is quickly weaving AI features into its competing Android operating system. While AI leaders Microsoft and Nvidia have seen their stock market values soar to record highs, Apple's shares have fallen 17% in 2025, with investors concerned about the impact of tariffs, and about what they view as slow progress integrating AI features into its products. Apple has delayed the release of an AI-enriched version of Siri, its virtual assistant, but Cook said the company is "making good progress on a personalized Siri." He also said Apple, which has thus far not engaged in the massive capital expenditures of its Big Tech rivals to pursue AI, is "significantly growing" its investments in artificial intelligence. "Apple has always been about taking the most advanced technologies and making them easy to use and accessible for everyone, and that's at the heart of our AI strategy," Cook said. Apple faces regulatory rulings in Europe that threaten to undermine its lucrative App Store business. Apple said sales from its services business, which includes the App Store as well as music and cloud storage, were $27.42 billion, topping analyst expectations of $26.8 billion. Sales of wearables such as AirPods and Apple Watches were $7.4 billion, missing estimates of $7.82 billion. Mac sales of $8.05 billion beat expectations of $7.26 billion, while iPads hit $6.58 billion in sales, missing expectations of $7.24 billion. Apple said gross margins were 46.5% in the fiscal third quarter, beating analyst expectations of 45.9%, according to LSEG estimates. The company forecast gross margins for the current quarter of 46% to 47%, with the entire range above estimates of 45.9%, according to LSEG data.
Yahoo
02-08-2025
- Business
- Yahoo
Apple sets quarterly revenue record as earnings broadly beat expectations, shares climb
Apple blew past Wall Street expectations with its third-quarter earnings report released Thursday, revealing robust growth driven by persistent iPhone demand, surging services revenue, and resilience in key international markets—even as tariff anxieties and questions over its artificial intelligence (AI) roadmap loomed over the industry. For the quarter ended June 28, 2025, Apple posted revenue of $94 billion, representing a 10% increase compared to the same period last year. Net income soared to $1.57 per share—up 12% from a year ago and significantly ahead of analyst forecasts, which had pegged earnings per share at $1.43 on expected revenue of $89.22 billion. Gross margin nudged up to 46.5%. CEO Tim Cook celebrated the results, noting 'Apple is proud to report a June quarter revenue record with double-digit growth in iPhone, Mac and Services and growth around the world, in every geographic segment.' Apple's board declared a quarterly dividend of $0.26 per share, payable August 14 to shareholders of record as of August 11. The installed base of active devices hit a 'new all-time high,' according to CFO Kevan Parekh, underscoring Apple's customer loyalty amid intensifying market competition. Apple shares climbed more than 2.5% post-market on the results. Segment highlights Apple's signature iPhone business was the principal engine of growth, generating $44.6 billion in sales—up from $39.2 billion the previous year. This far exceeded most forecasts and reinforced the iPhone's dominance, even as competitors ramp up their global push. The Services segment, encompassing the App Store, Apple Pay, Apple TV+, Apple Music, and iCloud, also set a new record: revenue there hit $27.4 billion, a 13% increase over last year. The success of Apple TV+ was underscored by the summer box office triumph of 'F1: The Movie,' which has grossed nearly $513 million worldwide. Mac sales also posted double-digit growth, rising to $8 billion. In contrast, iPad and Wearables revenue both saw modest declines, but these were more than offset by the core and services businesses. International & trade dynamics Growth was broad-based—notably including China, where Apple outperformed expectations with $15.4 billion in sales. This comes amid a tense geopolitical environment: President Donald Trump, seeking to enact tariffs of at least 25% on non-U.S.-made iPhones, had warned Apple to 'manufacture in the U.S., not India, or anyplace else.' The company had projected a $900 million headwind from tariffs this quarter but successfully navigated the challenge, in part by accelerating its shift in device manufacturing from China to India. Looking ahead Despite these achievements, investor scrutiny remained focused on Apple's comparative lag in artificial intelligence rollouts—especially as competitors like Meta and Microsoft grab headlines for major AI advances. Apple's stock, while buoyed after the earnings beat, has fallen 16% year-to-date, underperforming the broader S&P 500. Still, many analysts remain bullish, citing Apple's ecosystem strength, user retention, and ability to deftly manage global headwinds. Some analysts have expressed impatience with Tim Cook, even arguing for him to be replaced. Longtime Apple bull Dan Ives has thrown his support behind Cook but argued for a transformative M&A deal for Apple to get a leg up in the AI race, slamming a recent presentation as something that 'felt like an episode out of 'Back to the Future,'' although though that was a film, not an episodic TV series. For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. This story was originally featured on Sign in to access your portfolio
Yahoo
01-08-2025
- Business
- Yahoo
Apple Q3 Beats, iPhone Drives $94 Billion Revenue
Apple (NASDAQ:AAPL) sailed past Q3 FY2025 estimates, with iPhone demand doing the heavy lifting as revenue hit $94.04 Billion and EPS came in at $1.57. iPhone revenue was $44.58 billion, up 13% YoY and $4 Billion ahead of what the Street was looking for, and Mac also surprised on the upside with $8.05 billion versus a $7.3 billion forecast. Services chipped in $27.42 billion, topping expectations, which helped balance out the pullback in iPad and Wearables, home and accessories, both of which slipped 8% and 8.6% YoY and just missed their numbers. Tim Cook framed it as a June quarter record, pointing to double-digit growth in iPhone, Mac and Services around the world, while CFO Kevan Parekh highlighted new all-time highs in active devices and 12% EPS growth as proof that loyalty and satisfaction remain high. Outside color came from Julian Lin of Best Of Breed Growth Stocks, who noted the strength was aided by easier comps and warned that a lingering tariff overhang leaves some uncertainty on what comes next. The board added a $0.26 cash dividend, a signal the cash engine is still humming. The beat shows core customer demand is solid even as some hardware softens, but the tariff question and mixed category performance mean investors need to see if the cadence holds. This article first appeared on GuruFocus.
Sydney Morning Herald
01-08-2025
- Business
- Sydney Morning Herald
Banks slump as ASX opens sharply lower
Overnight, the S&P 500 fell 0.4 per cent, the Dow Jones lost 0.7 per cent and the Nasdaq composite slipped less than 0.1 per cent. Loading Healthcare stocks were the biggest drag on the market. Eli Lilly & Co. fell 2.6 per cent, UnitedHealth Group slid 6.2 per cent and Bristol-Myers Squibb lost 5.9 per cent. About 70 per cent of stocks in the S&P 500 lost ground, but big technology stocks with hefty values helped temper the impact of losses in health care and other sectors. Technology stocks rose following results from big companies showcasing advancements in artificial intelligence. Meta Platforms, the parent company of Facebook and Instagram, surged 11.3 per cent after it crushed Wall Street's sales and profit targets even as the company continues to pour billions into artificial intelligence. Microsoft jumped 4 per cent after also posting better results than analysts expected. The software pioneer also gave investors an encouraging update on its Azure cloud computing platform, which is a centrepiece of the company's artificial intelligence efforts. Apple and Amazon reported their results after the closing bell. Apple forecast revenue well above estimates, following strong June-quarter results supported by customers buying iPhones early to avoid Trump's tariffs. Chief financial officer Kevan Parekh said the company expected revenue growth for the current quarter in the 'mid to high single digits', which exceeded the 3.27 per cent growth to $US98.04 billion ($152 billion) that analysts expected, according to LSEG data. Apple shares are 3 per cent higher in after-hours trading. Amazon posted higher fiscal second-quarter profit and sales, underscoring its resilience despite tariff uncertainty. The company also offered on Thursday a sales outlook for the current quarter that beat analysts' projections. Still, its shares fell 5 per cent in after-market trading. Loading Earnings remained a key focus outside the technology sector in what has been a heavy week so far for corporate financial results. CVS Health rose 0.3 per cent after it topped Wall Street expectations for the second quarter and raised its full-year forecast again. Wall Street is also monitoring the latest economic data, which included an update on inflation. The Commerce Department said prices rose 2.6 per cent in June compared with a year ago, as measured by the personal consumption expenditures index. That's the Federal Reserve's preferred measure for inflation. The latest reading was slightly higher than economists expected and also marks an increase from an annual pace of 2.4 per cent in May. Results from another measure of inflation earlier this month, the consumer price index, also showed inflation rising in June. Also on Thursday, a report showed that the number of Americans filing for unemployment benefits inched up last week. The latest updates on inflation and the jobs market are landing amid lingering concerns about the impact of tariffs. Inflation's temperature is being closely monitored by businesses and the Fed to better gauge the impact of Trump's on-again-off-again approach to import taxes. Companies including Ford and Hershey's have more recently warned that tariffs are weighing on their latest and projected financial results. Trump has said he will levy tariffs against goods from dozens of countries if they don't reach agreements with the US by Friday. The latest developments in the seemingly unpredictable tariff landscape include a potential pause in tariff escalations with China and a deal with South Korea. Wall Street has been tempering their expectations for rate cuts at the Fed's next meeting in September. Traders now see a 39 per cent chance of a rate cut, according to data from CME Group. That's down from 58.4 per cent a week ago and a 75.4 per cent chance a month ago. Treasury yields held steady in the bond market. The yield on the 10-year Treasury slipped to 4.36 per cent from 4.37 per cent late on Wednesday. The yield on the two-year Treasury remained at 3.94 per cent from late Wednesday.
Reuters
01-08-2025
- Business
- Reuters
Apple revenue forecast beats estimates, tariff costs projected at $1.1 billion
SAN FRANCISCO, July 31 (Reuters) - Apple (AAPL.O), opens new tab forecast revenue for the current quarter ending in September well above Wall Street's estimates on Thursday, sending shares up despite a warning from CEO Tim Cook that U.S. tariffs would add $1.1 billion in costs over the period. As the centerpiece of U.S. President Donald Trump's trade war, those tariffs cost Apple $800 million in the June quarter and spurred some customers to buy iPhones in late spring this year. Those purchases helped Apple's fiscal third-quarter sales beat expectations by the biggest percentage in at least four years, according to LSEG. The company still forecast growth, though, with Chief Financial Officer Kevan Parekh saying the company expects revenue growth for the current quarter in the "mid to high single digits," which would exceed the 3.27% growth to $98.04 billion that analysts expected, according to LSEG data. Apple reported $94.04 billion in revenue for its fiscal third quarter ended on June 28, up nearly 10% from a year earlier and beating analyst expectations of $89.54 billion, according to LSEG data. Its earnings per share of $1.57 topped expectations for $1.43 per share. Apple shares were up 3% in after-hours trading, extending gains after Apple provided its forecast. Sales of iPhones, the best-selling product for the company based in Cupertino, California, were up 13.5% to $44.58 billion, beating analyst expectations of $40.22 billion. Apple has been shifting production of products bound for the U.S., sourcing iPhones from India and other products such as Macs and Apple Watches from Vietnam. The ultimate tariff rates many Apple products could face remain in flux, and many of its products are currently exempt. Sales in its Americas segment, which includes the U.S. and could face tariff impacts, rose 9.3% to $41.2 billion. In Greater China, where Apple has faced long delays in approval to introduce AI features on its devices, sales were $15.37 billion, up from a year ago and above expectations of $15.12 billion, according to a survey of five analysts from data firm Visible Alpha. That gain was a turnaround from a year-over-year decline in China sales in the March quarter. In a conference call with analysts, Cook said some of that was due to a subsidy program in China to help revive the smartphone market, which boosted some of Apple's products. "It was the first full quarter of the subsidy playing out," Cook told analysts. In an interview with Reuters, Cook said the company set seasonal records for upgrades of iPhones, Macs and Apple Watches. He said Apple estimates about 1 percentage point of its 9.6% of sales growth in the quarter was attributable to customers making purchases ahead of potential tariffs. "We saw evidence in the early part of the quarter, specifically, of some pull-ahead related to the tariff announcements," Cook told Reuters, though he also said the active user base for iPhones hit a record high in all geographies. The U.S. is still negotiating with both China and India, with Trump saying India could face 25% tariffs as early as Friday. However, analysts said India could still retain cost advantages for Apple in the longer term. "The pull-forward in demand due to tariffs was somewhat expected given the uncertainty around pricing. However, it's important to put this in context as this is typically a slow quarter for Apple, yet they still delivered exceptional results with iPhone growth," Emarketer analyst Jacob Bourne said. Tariffs are only one of Apple's challenges. The company faces competition from rivals such as Samsung Electronics Co ( opens new tab in a tough market for premium-priced mobile phones. On the software front, Apple faces challenges from Alphabet (GOOGL.O), opens new tab, which is quickly weaving AI features into its competing Android operating system. While AI leaders Microsoft and Nvidia have seen their stock market values soar to record highs, Apple's shares have fallen 17% in 2025, with investors concerned about the impact of tariffs, and about what they view as slow progress integrating AI features into its products. Apple has delayed the release of an AI-enriched version of Siri, its virtual assistant, but Cook said the company is "making good progress on a personalized Siri." He also said Apple, which has thus far not engaged in the massive capital expenditures of its Big Tech rivals to pursue AI, is "significantly growing" its investments in artificial intelligence. "Apple has always been about taking the most advanced technologies and making them easy to use and accessible for everyone, and that's at the heart of our AI strategy," Cook said. Apple faces regulatory rulings in Europe that threaten to undermine its lucrative App Store business. Apple said sales from its services business, which includes the App Store as well as music and cloud storage, were $27.42 billion, topping analyst expectations of $26.8 billion. Sales of wearables such as AirPods and Apple Watches were $7.4 billion, missing estimates of $7.82 billion. Mac sales of $8.05 billion beat expectations of $7.26 billion, while iPads hit $6.58 billion in sales, missing expectations of $7.24 billion. Apple said gross margins were 46.5% in the fiscal third quarter, beating analyst expectations of 45.9%, according to LSEG estimates. The company forecast gross margins for the current quarter of 46% to 47%, with the entire range above estimates of 45.9%, according to LSEG data.
