Apple's $1 trillion value at risk after earnings stumble

Apple's $1 trillion value at risk after earnings stumble

Instead, Apple will provide revenue totals for its product categories, which makes it more hard to understand how well a given gadget is selling.

The new programme will include the iPhone 5 and other Apple products that are "about to become obsolete". Brand new iPad Pros and MacBook Airs were introduced just this week and they are even bringing back the Mac Mini.

The company, which became the first ever to reach a $1 trillion market cap in August, just reported another record quarter, with revenue up 20 percent from the same time a year ago. CEO Tim Cook said weakness in emerging markets, unfavorable foreign exchange rates, and questions about whether the company can meet demand for iPhones all factored into that guidance.

Apple earned $14.1 billion, a 32 percent increase from the same time a year ago.

Shares fell more than 7%, pushing the company's market cap below $US1 trillion. It managed to recover, though: as at 6:50am in NY, it was at $1.073 trillion. On Thursday, the tech giant put a stop to the era of smartphone sells determining its share price, informing its shareholders that it will no longer break down how many iPhones, iPads or Mac computers it ships.

The flat sales of iPhones and yet the increased revenue shows that Apple is earning by increasing the price of the devices.

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Cook was confident, however, that Apple will be able to get through the circumstances, as the company is armed with "our strongest line-up of products and services ever".

"We concluded a record year with our best September quarter ever, growing double digits in every geographic segment", said Luca Maestri, Apple's CFO. Apple stocks plunged another 6.7% after the conference call.

From next quarter onwards, Apple will only report overall total revenue and cost of sales. "We generated $19.5bn in operating cash flow and returned over $23bn to shareholders in dividends and share repurchases in the September quarter, bringing total capital returned in fiscal 2018 to nearly $90bn". However, after failing to find a satisfying number of new customers for iPhone, Apple has turned to a strategy which will allow people to see only the rosy part of Apple's performance and will have a comparatively lesser impact on its share value.

But from now on, Apple will keep those numbers to itself.

"While it's frustrating how Apple, with no warning, made a decision to pull the plug on unit metrics, our core bull thesis does not change on the story and to some extent is emboldened by the (approximately) $800 (average selling price) story and a robust services business poised to hit $50 billion-plus in (Apple's) 2020 fiscal year", Ives said.

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