Apple announces record $110B buyback as Q2 results meet expectations
Apple has announced a record-breaking $110 billion share buyback, marking a 22% increase from last year's $90 billion authorization. This announcement coincided with a 7% rise in Apple's shares in extended trading on Thursday, following the release of its fiscal second-quarter earnings. During Q2, the tech giant saw a 4% dip in total sales and a 10% drop in iPhone sales compared to the same quarter last year.
Apple's Q2 earnings exceed low expectations
For the quarter ending March 30, Apple reported an earnings per share (EPS) of $1.53, surpassing the London Stock Exchange (LSEG) consensus estimate of $1.50. The company's revenue for the same period was $90.75 billion, slightly above the projected $90.01 billion. However, iPhone revenue fell short of expectations at $45.96 billion against a forecasted $46 billion. Mac revenue beat estimates but iPad sales were below expectations at $5.6 billion versus the expected $5.91 billion.
Apple forecasts sales growth and iPad surge in June quarter
Apple CEO Tim Cook told CNBC that the company expects overall sales to rise in the "low single digits" during the June quarter. In the same period last year, Apple reported revenue of $81.8 billion, with LSEG analysts predicting a figure of $83.23 billion this year. During an earnings call, Apple's finance chief Luca Maestri projected double-digit year-over-year percentage growth for iPad sales in the current quarter and sustained high-rate growth for the Services division.
Apple's net income dips, new products expected to boost sales
Apple reported a net income of $23.64 billion or $1.53 per share for this quarter, a 2% decrease from last year's $24.16 billion or $1.52 per share. Cook attributed this decline to a challenging comparison with last year when Apple realized $5 billion in delayed iPhone 14 sales due to COVID-based supply issues. Despite the dip in iPhone sales, Mac sales increased by 4% to $7.45 billion, driven by the new M3-powered MacBook Air models released in March.
Apple's other products and services show mixed performance
Apple's 'Other Products' category, which includes the Apple Watch and AirPods, saw a 10% decrease in sales year over year to $7.9 billion. However, the Services business emerged as a bright spot during the quarter with sales increasing 14.2% to $23.9 billion. This revenue includes earnings from subscription services, warranties, licensing deals with search engines, and payments.
Apple's sales in Greater China surpass expectations
Despite an 8% drop, Apple's sales in Greater China, its third-largest region, reached $16.37 billion in revenue, surpassing FactSet analysts' expectations of $15.25 billion. Cook expressed optimism about the region and revealed that iPhone sales grew during the quarter. Alongside the share buyback announcement, Apple also declared it would distribute a 25-cent dividend, marking a 1-cent increase from previous payouts.
