Apple Optimistic As IPhone Price Cuts Help In China, Watches Pull In New Buyers | 4/28/2016 | Staff
marika (Posted by) Level 3
(Reuters) – Apple Inc on Tuesday forecast stronger-than-expected third-quarter revenue and Chief Executive Tim Cook said iPhone sales had started to stabilize in China, a sign that Apple’s price cuts there are helping limit sales declines.

IPhone sales marked their steepest decline ever, falling 17 percent in the fiscal second quarter from a year earlier and slightly missing analyst expectations. But Apple executives said a pickup in iPhone sales toward the end of the second quarter, along with growth in sales of services and wearable devices, made them optimistic about the current quarter.

Apple - Beat - Analyst - Expectations - Business

Apple beat analyst expectations for its wearable business, bringing in sales of $5.13 billion compared with estimates of $4.79 billion, according to FactSet data.

Wearables include the Airpods wireless headphones and the Apple Watch. Chief Financial Officer Luca Maestri told analysts on a call that 75 percent of Apple Watch buyers were new to the product.

Apple - Revenue - Quarter - June - Analysts

Apple said it expects revenue between $52.5 billion and $54.5 billion for the current quarter ending in June, above analysts’ average estimate of $51.93 billion, according to IBES data from Refinitiv.

In an interview, Apple Chief Executive Tim Cook said that iPhone sales started to strengthen during the last few weeks of the fiscal second quarter.

IPhone - Results - Q2 - Results - Basis

“As we look at the iPhone results through Q2, the results were stronger on a year-on-year basis for the last few weeks of the quarter. We also saw a similar result in China,” Cook told Reuters in an interview. “These, along with the continued success with wearables and so forth, give us some confidence that things are getting a bit better.”

Apple reported net earnings per share of $2.46 for the March quarter, compared with Wall Street’s average estimate of $2.36.

Apple - IPhone - Revenues - Analyst - Estimates

Apple said iPhone revenues were $31.05 billion, slightly below analyst estimates of $31.10 billion, according to data from FactSet.

Services revenue, which includes...
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