Apple holiday season tops projections as iPhone bounces back
SAN FRANCISCO — Apple is still reaping huge profits from the iPhone while mining more moneymaking opportunities from the growing popularity of its smartwatch, digital services and wireless earbuds.
That combination produced a banner holiday season for a company whose fortunes appeared to be sliding just a year ago amid declining sales for the iPhone, its marquee product for the past decade.
Apple's fiscal first-quarter results, released Tuesday, provided the latest proof that the fears hanging over the consumer electronics icon might have been unfounded.
Apple's profit and revenue for the October-December period topped analysts' projections, providing another boost to a stock that has more than doubled in less than 13 months.
The shares surged more than 1% to $322.14 in extended trading after the numbers came out. That's up from $142 in January 2019 after Apple warned that consumers weren't buying as many new iPhones as they once were, especially in China, the company's biggest market outside the U.S. and Europe. China is also where Apple makes most of its iPhones and several other products.
If the shares move similarly in Wednesday's regular trading session, they will flirt with a new alltime high for the stock and further cement Apple's position as the most valuable company in the U.S., with a market value of $1.4 trillion.
A deadly viral outbreak in China, which has curtailed travel and threatens the world economy, looms as a potential concern for Apple. But investors for now are focusing on what looks like an even more prosperous road ahead for a company that turned a $55 billion profit in its past fiscal year.
In a conference call Tuesday, CEO Tim Cook said the coronavirus outbreak has already caused some of Apple's suppliers in China to delay reopening their factories closed for the Lunar New Year holiday from the end of this month until Feb. 10. And some stores in China selling Apple products already have temporarily closed or reduced their operating hours because fewer customers are shopping as virus worries escalate.
"The situation is emerging and we're still gathering lots of data points and monitoring it very closely," Cook said.
Apple got off to a fast start for fiscal 2020, with a first-quarter profit of $22.2 billion, or $4.99 per share, on revenue of $91.8 billion. Analysts polled by FactSet had predicted earnings of $4.54 per share on revenue of $88.5 billion.
As usual, the iPhone remained Apple's marquee attraction. Boosted by the release of the iPhone 11 heading into the holiday season, the product generated sales of $56 billion, an 8% increase from the previous year's disappointing showing.