Five things you need to know about Apple's latest results

Here's how Apple thrashed expectations this quarter.

Let’s be honest, Q2 isn’t exactly the most exciting quarter for Apple.

It’s straight after Christmas, and no amazing new products are released during this period, so sales are naturally going to lag compared to the other quarters. But Apple watchers pay attention to the quarterly results because the figures offer guidance on what the technology giant may be planning for the rest of the year.

Here are five takeaways from Apple’s latest numbers:

1. Unlike last year, Apple’s Q2 revenue thrashed expectations

According to chief executive Tim Cook, revenue was buoyed by strong iPhone sales across the globe. Which leads on to the next point…

2. The iPhone is still by far Apple’s strongest, most promising product

At face value, it seems Apple’s iPhone 5S/5C product split strategy paid dividends for the company, but broadening international sales of cheaper older products, like the iPhone 4S, also helped to lift total sales in the period.

Of course, this figure places pressure on Apple to keep the momentum going with the next iPhone launch -- which typically happens around September. The current rumours around the upcoming product launch have centred around it having a larger (possibly) 5-inch screen. But will this latest success stop Apple from tweaking its seemingly winning iPhone formula? We’ll have to wait and see.

3. Changing the screen size hasn’t helped: iPad sales are starting to slip

It’s not all good news for Apple: Despite a strong performance over the Christmas period, iPad sales are starting to weaken, providing a hint that the newish iPad Mini may not be the hit that Apple hoped it would be.

4. Despite seasonal decline in most regions, revenue in Apple’s Greater China revenue segment grew

Despite Apple’s recent China Mobile deal, the Greater China region showed stronger sequential growth between the first and second quarters last year. But this graph hints at the hope Apple has for this segment: it’s defying international trends and turning out to be a strong area of growth for the company.

5. Meanwhile, ever since Apple split its China segment from APAC, Apple’s sales revenue in our region has stagnated

While Apple may be celebrating its win in China, its APAC sales figures are looking pretty flat. It’s difficult to make any concrete conclusions about the Apple lustre in the Australian market, as we’re lobbed into the same region as Indonesia, Singapore, New Zealand and Thailand -- all of which are very different markets.

And one last thing for Apple investors…

The company has boosted its share buyback program by $US30 billion. Cook says Apple is undervalued.

This is meant to be a bit of a quick take. If you’re after a more detailed analysis of this latest round of results, check out Supratim Adhikari’s piece on Apple’s latest numbers here

Got a question? Ask the reporter @HarrisonPolites on Twitter or leave a comment below.

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles