Apple’s fiscal fourth-quarter earnings report revealed that while the iPhone 15 was outperforming its predecessor, revenue fell approximately 1% from the previous year to $89.5 billion, marking four consecutive quarters of decline—the first such stretch since before the launch of the iPhone in 2007. The company’s CFO, Luca Maestri, cautioned investors not to expect revenue growth in the upcoming December quarter, a crucial period for Apple’s business. Maestri noted continued weakness in Apple’s Mac, iPad, and Wearables businesses despite a positive outlook for iPhone sales.
Unlike previous years, Apple did not provide official hard number guidance for the December quarter. Instead, Maestri mentioned that the current quarter’s revenue would be “similar” to the same period last year, which faces challenges during the crucial holiday season. Wall Street analysts had expected better performance, with revenue in the December quarter of about $123 billion, representing around 5% growth compared to the year-ago period.
While Maestri expects year-over-year growth in iPhone sales on an absolute basis, other hardware businesses like Mac, iPad, and Wearables may face challenges. Mac revenue is expected to “significantly accelerate” from the September quarter, which saw a nearly 34% year-over-year decline. However, this still suggests a decline from the previous year when Apple reported $7.74 billion in Mac revenue in the December quarter.
Apple’s iPad and Wearables businesses declined on an annual basis in the September quarter, and further declines are anticipated in the current quarter. Despite growth challenges in hardware, Apple’s services business, encompassing App Store sales, cloud storage, AppleCare warranties, advertising, licensing deals with Google, and subscriptions like Apple Music, is expected to experience strong double-digit growth.
The decline in revenue for four consecutive quarters signals a shift in Apple’s financial trajectory, raising questions about its ability to sustain growth and navigate challenges in its hardware business.
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