For the second time since Tim Cook took the helm, Apple missed the mark in its quarterly earnings—which analysts expected, thus lowering their estimates to a consensus of roughly $37 billion in sales. Surprisingly, Apple missed those estimates as well, coming in at $35 billion, with a net profit of $8.8 billion. Apple closed the day at $600.92 per share, but dropped some 5% in after-hours trading to $570.
The missed earnings are the result of a combination of factors, including economic turmoil in Europe and China. Additionally, while the new iPad became available in China this quarter, sales only began July 20, thus missing third quarter earnings. And, like the last time Apple reported lower than expected revenues, there was no iPhone released this summer (because it is expected to be released in the fall).
Apple sold 26 million iPhones last quarter, an increase of 28% over the same quarter last year, but that’s still lower than the 29-30 million units sold that analysts were expecting.
The company also sold 17 million iPads, marking an 84% increase over the same quarter last year. This outshined analysts’ expectations of 15 million iPads sold.
In today’s earnings call, Apple shared a few interesting tidbits, such as the fact that iPhone use within Fortune 500 companies has doubled in the last year, and companies like PepsiCo have created in-house iPhone apps just for their employees. Similarly, iPad sales among Fortune 500 companies have tripled in the last year.
In all, Apple has sold more than 410 million cumulative iOS devices in the last three months and has paid out more than $5.5 billion to developers.
Apple CFO Peter Oppenheimer also discussed the rising use of iPads in the classroom. “Sales of the reduced priced iPad 2 in the K-12 market have been strong,” said Oppenheimer, adding: “we achieved all-time record Mac sales this quarter, but we sold twice as many iPads as Macs to US educational institutions.” He cited the example of one independent school system in Texas, which purchased 11,000 iPads so that teachers could distribute them to students to “flip” their classrooms (having students watch video lessons at home and engaging with the material in the class).
Apple expects about $34 billion in revenue next quarter.
Image source: glup.me