Apple’s sizzling June 2021 quarter in five easy charts

The ups and downs of Apple’s revenue, earnings per share, iPhone sales, services and wearables.

Apple handily beat the Street’s most bullish estimates, reporting revenue up 36% and EPS a cool 100%. Also notable were the year-over-year growth in iPhone revenue (50%), services (33%) and wearables et al. (36%).

Apple’s shares, which closed down $2.22 (-1.49%) for the day, popped briefly in after-hours trading before reverting to the doldrums.

From the press release:

Apple today announced financial results for its fiscal 2021 third quarter ended June 26, 2021. The Company posted a June quarter record revenue of $81.4 billion, up 36 percent year over year, and quarterly earnings per diluted share of $1.30.

“This quarter, our teams built on a period of unmatched innovation by sharing powerful new products with our users, at a time when using technology to connect people everywhere has never been more important,” said Tim Cook, Apple’s CEO. “We’re continuing to press forward in our work to infuse everything we make with the values that define us — by inspiring a new generation of developers to learn to code, moving closer to our 2030 environment goal, and engaging in the urgent work of building a more equitable future.”

“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,” said Luca Maestri, Apple’s CFO. “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.”

Apple’s board of directors has declared a cash dividend of $0.22 per share of the Company’s common stock. The dividend is payable on August 12, 2021 to shareholders of record as of the close of business on August 9, 2021.

No formal revenue guidance, but quite a bit of forward-looking detail. Transcript here.

Below: The five charts. Click the second column to see year-over-year growth. (Not seeing the charts? Try the website.)

48 Comments

  1. bas flik said:
    after 40% miss now a 30% miss.
    street is terrible in analysing apple.
    how you can miss that much.

    12
    July 27, 2021
  2. Eric Lambeth said:
    Earnings per share up 100% from a year ago. Yowzza!

    Making the elephant tap dance.

    9
    July 27, 2021
  3. Gregg Thurman said:
    I should have never adjusted my estimates.

    1
    July 27, 2021
    • Bart Yee said:
      @Gregg
      You did have it closer with this post:
      Gregg Thurman said:
      In the early days of Estimize there were as many as 1400 estimates submitted. Today that number has shrunk to about 300. The know nothing amateurs have flown the coup, leaving behind the pros and serious amateurs. This group habitually performs better than pure WS consensus.
      My EPS estimate shows growth of 86% to $1.21. For quite a while my estimates have been in the top 8% at Estimize. Here’s hoping.
      July 23, 2021

      0
      July 28, 2021
  4. Bart Yee said:
    Dare I say it?
    Apple went BOOM! AGAIN!

    Having said that, so did MSFT, GOOGL, SBUX, etc. IMO, price action for AAPL may be blunted because of the competition for investment money by other companies with higher PE’s or sexy prospects. No matter, Apple will continue to grind higher.

    “Full speed ahead and steady as she goes” says Captain Cook as he and his crew pilots the starship Apple. (With apologies to Star Trek and Bob Brinker’s MoneyTalk)

    4
    July 27, 2021
  5. David Emery said:
    “the ups and downs….”

    Where’s the ‘downs’?

    3
    July 27, 2021
    • Alan Birnbaum said:
      Mr. Market;

      142.83 -3.94 (-2.68%)
      After hours: 05:33PM EDT

      I feel a Rodney Dangerfield joke coming on:
      My uncle’s dying wish – he wanted me on his lap. He was in the electric chair at the time.”

      No Respect, No Respect !!!!

      7
      July 27, 2021
  6. Manfred Schwencke said:
    Third quarterly BOOOOM!!! In a row!

    Stellar!

    Not understandable that „professional analysts“ are that far off!

    3
    July 27, 2021
  7. David Drinkwater said:
    [copy paste]

    And even Cybart’s lofty guesstimate was $1billion short!

    Unbelievable. Apple is absolutely crushing it, and yet AAPL gets crushed. It makes no sense to me, but Apple has a new ten weeks to grow into its true value before market shenanigans strike again.

    10
    July 27, 2021
  8. Daniel Epstein said:
    Buy the rumor sell the news! No matter how good the news! If you look at other competitor reports you might notice some blemishes. Microsoft Surface revenues down 20%. A lot of nervous nellies out there.

    4
    July 27, 2021
    • Bart Yee said:
      @Daniel No one cares whether Surface makes money for MSFT or not, it’s really not a core business, just as XBOX isn’t either. Same for Pixels, Nest and any other hardware Google or Amazon makes.

      Few people recognize that Services makes 22% of Apple’s gross revenue and pulls Apple’s gross margin up about 43+% over hardware.

      1
      July 27, 2021
  9. Michael Goldfeder said:
    Apple will continue to grind higher as the buybacks never stop. The traders need to keep the stock under $150 to cover various positions in the open market.

    Given the restrictions on the retail Apple stores along with the chips shortages, all I can say about the numbers for the quarter is: “Wow!”

    4
    July 27, 2021
  10. bas flik said:
    M1 is huge.
    iphone is huge.
    street underestimate hardware business of apple

    4
    July 27, 2021
  11. John Konopka said:
    Apple better stop increasing their revenue so much or the stock will really wind up in the tank.

    8
    July 27, 2021
  12. Hugh Lovell said:
    Anyone feeling depressed by the poor performance of AAPL should do what I’m going to do: watch an episode of Ted Lasso, then follow it up with Schmigadoon.

    4
    July 27, 2021
  13. Directional Insights? ??
    – foreign exchange impact
    – expect App store down YoY, yea right.
    M1 adoption by heavy hitters including all of Mass Mutual (ahem, Philip.)
    Katy Huberty – Katy barred the door?
    I had to drop off then.

    0
    July 27, 2021
  14. Of course overjoyed at Apple’s performance, without the least concern for the future of this investment, my SEP.
    The short term performance of Apple shares around Earnings? Surreal to the point of being disconnected from reality. A diné on peyoté, almost every single time, but I vehemently disagree with any disappointed Apple shareholders around Earnings. I’ve lived through this rodeo many times, once at Calgary Stampede, during Apple earnings conf.
    Sell away, at any price ye fools. Low prices certain to get devoured by buyback prog. & overseas investors.
    I prepare for Earnings by checking my camping gear, listening to results, going to my land, pitching my tent, & maybe cross the border 8/9 to see Québécois, eh?
    No cell signal or Internet at ‘Goretex home’, for several weeks. Only occasional coffee shops & suds slingers. Heaven is august New England after granite earnings.

    4
    July 27, 2021
  15. Jerry Doyle said:
    Apple is down in after hours $2.58 as I write with a stock price of $146.77. We blew the barn doors off and WS’s response: Can you do it again next quarter? Its this “sustainability” issue of which Gene Munster denoted this afternoon.

    Our core businesses are firing on all cylinders and WS yawns. Gene said to ignore the market’s reaction and focus on the company’s innovation of moving into massive growth markets in the coming decade such as transportation, health care, AR, all with the capacity to accelerate Apple’s growth exponentially in the coming years. Munster referenced what Joseph B always says. For Apple investors it all is about “patience” as a virtue.

    When you factor-in these new market growth areas Apple is tapping into, then you are talking well-beyond a market capitalization of 2.5T. Dan Ives sees a 3T market cap for Apple by EoY.

    It was denoted this afternoon by Tim Seymour on “Fast Money” traders that Apple now is getting essentially half its EPS from Services, a continuing flow of revenue subscriptions going forward, and growing. This means Apple’s valuation deserves a higher figure. There is this Apple hardware multiple & software multiple complex and WS needs to find what those multiples are for Apple’s true valuation. Why not just view as Dan Ives says as a “sum of its parts?” WS needs to view Apple’s growth multiple “holistically” in understanding the company’s true valuation going forward.

    Lastly, what few folk are grasping is that WOW factor Tim Cook denoted in Apple’s “double digit” sales to new users from Android and double digit growth to users’ in Apple’s IB who are upgrading. That factor seems to have flown by many WS analysts’ heads. Did they not catch that fact? That is “powerfully” impressive! Apple’s hardware brings new users into the Apple ecosystem to put those new users into Apple’s “Services System.”

    So, here we have Apple with a 30% plus margin on the hardware side feeding Apple upgrade users and new Android users into a Service ecosystem that has margins around 69%.

    As Gene Munster says: There is the Apple business and there is the Apple stock. Eventually the stock price follows the business. For Apple long term investors: “patience is a virtue.”

    1
    July 27, 2021
    • Bart Yee said:
      @Jerry, just as a point of reference at roughly 16.49B shares currently outstanding (subject to 10Q verification), a $3T valuation would be around $182. If Apple retires another 150-180M shares next quarter, the $3T valuation is at $184, roughly a 25% upward move.

      While checking Yahoo Finance AAPL page for stats, I note in a small box that they still consider AAPL “overvalued”, they project a -6% estimated return over a 5yr time horizon. Precisely why I don’t subscribe to any Yahoo! finance services.

      “Fair Value is the appropriate price for the shares of a company, based on its earnings and growth rate also interpreted as when P/E Ratio = Growth Rate. Estimated return represents the projected annual return you might expect after purchasing shares in the company and holding them over the default time horizon of 5 years, based on the EPS growth rate that we have projected.”

      1
      July 28, 2021
  16. Troy Thoman said:
    I think the fear of supply issues is what is driving the stock down but apparently, everyone forgot we are due for new iPad Minis and iPhones this quarter which naturally has a supply ramp. Why didn’t anyone ask if that’s one of the reasons for the supply constraints?

    2
    July 27, 2021
    • Jerry Doyle said:
      @Troy Thoman: I just wrote this comment to Joseph B and it is relevant with yours’. Apple is down $3.07 in after-hours to $143.70. The reason seems to be WS’s focusing on Luca Maestri’s comment that revenue growth will slow in the current quarter due to foreign exchange rates, the semiconductor shortage and tougher comparison with the previous year. To exacerbate matters, WS analysts continue to focus on whether Apple can sustain its performance into the successive quarter and consequently, they hung on every word Luca had to say about slowing revenue growth in the current quarter. Then Luca commented that he felt Apple’s services business which reached record high revenue in this report by growing 33% to 17.5B to self-correct and return to a more typical level. Could he not find a more euphemistically way of saying that statement?

      1
      July 27, 2021
  17. T R said:
    “Then Luca commented that he felt Apple’s services business which reached record high revenue in this report by growing 33% to 17.5B to self-correct and return to a more typical level. Could he not find a more euphemistically way of saying that statement?”

    I agree wit the sentiment, but he’s the sharpest CFO in action/results, and in earnings calls. (Consider the balancing act he and Tim walk in these calls, as they continue executing buybacks.)

    3
    July 27, 2021
    • Jerry Doyle said:
      @T R: I agree with your comment fully. I did not mean for my words to come across as denigrating Luca in any way, although I can see how one could have interpreted them as such. He is all as you say; and more. None of us are perfect. This was a time when perhaps, the wording differently would have made a significant difference in the subsequent response from WS investors. I was writing my words more as a lamentation on my part.

      2
      July 27, 2021
  18. Jacob Feenstra said:
    Though I always like to see a stock pop after good news, I really don’t care too much about what the market’s reaction is to AAPL… because I’m not in a hurry to sell and haven’t been for a looooong time. This Q3 report just underscores the strength of the fundamentals, like the Q2 and Q1 report did earlier in the FY. Eventually the market’s valuation of AAPL will align better with the fundamentals. I’m a satisfied stock holder who has learned to be patient with the market (well at least mostly patient).

    5
    July 27, 2021
  19. Rodney Avilla said:
    I am reminded that when they make these next quarter “guesses”, they have almost a month’s worth of hard data to go on.

    0
    July 27, 2021
  20. bas flik said:
    125 will be good entry point to buy more apple shares.

    0
    July 28, 2021
    • Mark Visnic said:
      @bas

      $125 would be a good buy price but, I’ve been there and done that and I won’t be waiting to buy there again as $145 is a good buy price and I expect a better probability of executing between 135 and 145 than 125 with this new information.

      0
      July 28, 2021

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