Apple Rides Better iPhone Sales To Q4 Earnings Surprise

Apple CEO Tim Cook gestures after opening the newly renovated Apple Store at Fifth Avenue

Apple: Older iPhones, iPads must be updated before Sunday

In an opposite trend to the iPhone, iPad revenue has increased year-over-year for four consecutive quarters now - it seems the focus Apple put on refreshing its tablet lineup has moved the needle, even though the $4.7 billion in iPad revenue for the quarter makes it the smallest of the product categories Apple reports on.

Apple's stock remained largely unchanged after-hours following the release of its Q4 earnings.

For the holiday quarter, Apple said it expects revenue between $85.5 billion and $89.5 billion, with a midpoint roughly in line with average analyst estimates of $86.9 billion.

While Apple has developed different devices and new digital services in recent years, it still relies on the iPhone for more than half of its revenue and profit.

The Apple Card launched in the United States in August, "and we've been thrilled by the positive reception we've seen", Cook said Wednesday on a conference call discussing Apple's fourth quarter financial results. On the other hand, iPad sales are up by 16.9% with revenue of $4.66 billion, while Mac sales are down by 4.8%, although they still brought in $6.99 billion. Wearable sales were also up, by 35 percent, to $6.5 billion.

Starting just before 12:00 a.m. on November 3, iPhone 5 will require an iOS update to maintain accurate Global Positioning System location and to continue to use functions that rely on correct date and time including App Store, iCloud, email, and web browsing, according to Apple. According to Wedbush's Dan Ives, demand for the iPhone 11 in China are tracking 15% to 20% above expectations, and US consumers are also believed to be snapping up more of the units.

The forecast suggests Apple is seeing strong demand for the iPhone 11 and iPhone 11 Pro models that went on sale in September.

This is all because of the Global Positioning System time rollover issue, according to Apple, something that happens about every 19 years when Global Positioning System devices need to reset in order to accurately measure time and dates, according to the Office of Electricity at the Department of Energy. But Apple's share buybacks reduced the number of shares outstanding. Sales in Japan and Europe also declined.

For all of fiscal 2019, Apple iPhone revenue came to $142.38 billion, down 13.6% from the $164.89 billion it grossed in fiscal 2018.

Still, sales fell in several areas outside the U.S. In China, revenue slipped 2% to $11.1 billion. This resulted in earnings per share of $11.97 compared to $12.01 past year.

Apple shares rose about 1.5% in extended trading on Wednesday.

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