Ap­ple mar­gins fall in fourth quar­ter re­sults

Rev­enue down – but Ap­ple still makes money by the boat­load

Mac Format - - APPLE CORE -

Fall­ing prof­its are no longer the stuff of night­mares around the Ap­ple Cam­pus – they're be­com­ing all to real for Ap­ple's head hon­chos.

Ap­ple's re­cent fourth quar­ter re­sults show that gross mar­gin fell from 39.9% a year ago to 38% in the fourth quar­ter of 2016. Quar­terly rev­enue was down from $51.5 bil­lion to $46.9 bil­lion, and net in­come also dropped from $11.1 bil­lion to $9 bil­lion.

Of course, that is still a huge amount of money for any com­pany, and it's un­likely that Tim Cook will be feel­ing the heat too much. But for a com­pany that was once known for its un­flag­ging march to­wards higher and higher prof­its, it's a sign of the chang­ing times in the ul­tra-com­pet­i­tive tech world.

There were some healthy signs, though. The ser­vices side of grew 24%, driven by op­er­a­tions such as the App Store and iCloud.

Fur­ther­more, Ap­ple posted some bullish guid­ance for the first quar­ter of 2017: ex­pected rev­enue be­tween $76 bil­lion and $78 bil­lion, and gross mar­gin be­tween 38% and 38.5%. The in­creased rev­enue is likely to be due to the sales bump from the iPhone 7, as well as the newly up­dated MacBook Pros.

The fourth quar­ter re­sults still make Ap­ple one of the wealth­i­est com­pa­nies on the planet.

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