Apple share price: 3 things we learnt from Q2 results
The tech company's Q2 results had three vital lessons for investors.
Apple’s Q2 revenue was helped by products other than iPhones
Sales of devices like Apple Watch have helped propel Apple’s Q2 revenue in its services division to $11.4 billion.
Chief executive officer, (CEO), Tim Cook, touted the strong sales of Apple’s other products like the iPad and Apple Watch in Apple’s Q2 profits.
‘Our March quarter results show the continued strength of our installed base of over 1.4 billion active devices, as we set an all-time record for Services, and the strong momentum of our Wearables, Home and Accessories category, which set a new March quarter record,’ said Cook.
Cook touted the sales of Apple Watches after Apple’s Q2 revenue report.
‘Apple Watch is the best- selling and most loved smartwatch in the world, and produced its best results ever for a non-holiday quarter. It’s reaching many new customers, with three-quarters of purchases going to customers who have never owned an Apple Watch before,’ said Cook.
With iPhone sales declining year-over-year, Apple’s Q2 profits are dependent on other products to boost the company’s revenue.
Apple’s Q2 earnings were helped by improved international sales
Though iPhone sales are down overall, purchases did improve in China. Despite a ban on older models in 2018 because of a patent dispute conflict with Qualcomm, steep discounts on select models of iPhones and trade-in promotions in 2019 helped iPhone sales in the Asian nation. Cook noted that the discounts and possibly thawing relations between the US and China have boosted Apple’s Q2 results.
‘Our trade-in and financing programs have been well received there, and there’s an improved trade dialogue between the U.S and China, improving consumer confidence,’ said Cook.
Subscriptions helped Apple’s Q2 profits
In addition to strong sales from Apple devices, there was also growth in subscription services by 40% around the world. Cook touted the boom in subscribers to services like Apple Music.
‘We have 390 million paid subscriptions, all growing in strong double-digits. And we expect the number of paid subscriptions to pass half a billion in 2020,’ said Cook.
Apple Music has become so popular that its 28 million paid US subscribers top rival Spotify’s 26 million.
Apple’s Q2 earnings show that the corporation can succeed beyond iPhone sales with successful device sales and subscriptions to its services.
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