Apple’s not disastrous Q1 results in five easy charts

The ups and downs of Apple’s revenue, earnings, iPhone sales, services and revenue from greater China.

Revenue and earnings beat expectations, and given that the same quarter last year had an extra week, year-over-year comparisons weren’t at all bad. iPhone unit sales missed Wall Street’s consensus, but iPhone revenue beat the Street, up 13% (22% per week.

There was no hint of a “super cycle” in Apple’s March quarter guidance, which came in several billion below the Street. Whether the iPhone X supply chain cuts were as deep as rumored remains to be seen.

Apple’s share price, which trailed the market all quarter—and gave up 7% in the past two weeks—held its breath after the market closed. Then, as the conference call progressed, it picked up about 3.25%. Did I hear CFO Luca Maestri correctly that Apple plans to eventually return all its net cash—currently $163 billion—to long-term shareholders? That would please the Street.

Below: The results in five easy, clickable charts.

Note: Q1 ’17 included a one-time $640 million windfall. 

Not seeing the fancy graphics? Try the website. 

Apple’s conference call with analysts began shortly at 5 pm ET. Transcript via Six Colors here.

From the press release:

“We’re thrilled to report the biggest quarter in Apple’s history, with broad-based growth that included the highest revenue ever from a new iPhone lineup. iPhone X surpassed our expectations and has been our top-selling iPhone every week since it shipped in November,” said Tim Cook, Apple’s CEO. “We’ve also achieved a significant milestone with our active installed base of devices reaching 1.3 billion in January. That’s an increase of 30 percent in just two years, which is a testament to the popularity of our products and the loyalty and satisfaction of our customers.”

Thanks to great operational and business performance, we achieved all-time record profitability during the quarter, with EPS up 16 percent,” said Luca Maestri, Apple’s CFO. “Cash flow from operations was very strong at $28.3 billion, and we returned $14.5 billion to investors through our capital return program.”

Apple is providing the following guidance for its fiscal 2018 second quarter:

• revenue between $60 billion and $62 billion
• gross margin between 38 percent and 38.5 percent
• operating expenses between $7.6 billion and $7.7 billion
• other income/(expense) of $300 million
• tax rate of approximately 15 percent

Apple’s board of directors has declared a cash dividend of $0.63 per share of the Company’s common stock. The dividend is payable on February 15, 2018 to shareholders of record as of the close of business on February 12, 2018.

7 Comments

  1. Ralph McDarmont said:
    Unbelievably impressive charts tell the true Apple story. Thanks PED for charting all the data. And as pointed out the 5 week vs 4 week comparison is very important. Let’s see how the Chinese New Year pans out. Great job Apple. All the hate press had me spooked and I am ashamed I waivered. Same game every week or two before earnings, for years, but this time the negativity seemed particularly brutal.

    0
    February 1, 2018
  2. George Knott said:
    Phillip your articles kept me from selling on the fear and I am grateful for your articles, charts and MY TAKE comments….TY…

    3
    February 1, 2018
    • David Drinkwater said:
      Hanlon’s Razor:

      “Never attribute to malice that which is adequately explained by stupidity.”

      I, personally, don’t much differentiate between laziness and stupidity.

      Stupidity is a decision not to exercise the intellect (i.e. laziness).
      Laziness is a choice to do less, when more can be done (i.e. stupidity).

      There are cases where we have to get out of our own way (or out of the general way of things), but that’s more a question of wisdom.

      0
      February 2, 2018

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