Apple Jumps After Beating Revised First-Quarter Earnings Forecast
*By Chloe Aiello*
Apple spiked in extended trading on Tuesday after reporting earnings and revenue that pleased Wall Street.
Apple ($AAPL) reported earnings per share of $4.18 on revenue of $84.31 billion, just exceeding the expectations of analysts surveyed by Thomson Reuters for earnings of $4.17 per share on $83.97 billion in revenue.
Earnings increased year-over-year, thanks partially to [Apple's generous share buy-back program](https://www.wsj.com/articles/the-investment-that-cost-apple-9-billion-in-2018-11545925184?mod=hp_lead_pos2), but revenue slid about 4.5 percent from the prior year.
Apple’s reported revenue beat guidance the tech behemoth issued in early January, but easily missed the $89 billion to $93 billion revenue range Apple guided toward in November, when it last reported earnings.
“While it was disappointing to miss our revenue guidance, we manage Apple for the long term, and this quarter’s results demonstrate that the underlying strength of our business runs deep and wide,” Apple CEO Tim Cook [said in a statement](https://www.apple.com/newsroom/2019/01/apple-reports-first-quarter-results/).
Apple's Chief Financial Officer [Luca Maestri last quarter announced Apple would no longer break out iPhone unit sales](https://cheddar.com/videos/apple-trying-hide-something-reporting-shakeup). But in its earnings statement, Apple acknowledged that iPhone revenue declined 15 percent from the prior year, as revenue from other products and services grew 19 percent.
But Maestri added on a call with analysts Tuesday that the global active install base of iPhones is growing and "reached an all-time high at the end of December." He said it surpassed 900 million devices, up year-over-year in all geographic segments, even China, and grew almost 75 million in the last 12 months.
Services alone generated an all-time high revenue of $10.9 billion, up 19 percent year-over-year. Apple has been positioning itself to grow its services offerings, like iCloud and App Store, as sales have faltered for the iPhone, its core product.
Apple also offered guidance for the ongoing quarter. The company said it expects revenue between $55 billion and $59 billion.
Heading into its last earnings report, Apple was on top of the world. Despite stagnating sales of its core product, the iPhone, the tech behemoth had breached $1 trillion in market capitalization ー the first publicly traded U.S. company to do so ー and it had just unveiled several new iPhone models that promised to propel its average selling price further skyward.
But what followed was a turbulent quarter for the markets and for Apple. Cook’s preemptive outlook downgrade in a note to investors on Jan. 2 sent shares tumbling. Cook blamed weakness in the Chinese market for most of the revenue shortfall to its guidance, and for all of the year-over-year worldwide revenue decline.
Per Cook's warning, Apple's earnings report showed a notable slowdown in China. Sales in the last three months of 2018 declined about 27 percent year-over-year from $17.96 billion to $13.17 billion in Apple's Greater China segment, but sales in the Japanese and European markets also dipped.
Apple shares were up about 3.6 percent in after hours trading, but down about 2 percent year-to-date. Since it hit $1 trillion, the tech behemoth’s market cap has slid about 27 percent to $734 billion.
Chris Williamson, Chief Business Economist at S&P Global, breaks down September’s CPI print and inflation trends, explaining what it means for markets.
A big-screen adaptation of the anime “Chainsaw Man” has topped the North American box office, beating a Springsteen biopic and “Black Phone 2.” The movie earned $17.25 million in the U.S. and Canada this weekend. “Black Phone 2” fell to second place with $13 million. Two new releases, the rom-com “Regretting You” and “Springsteen — Deliver Me From Nowhere,” earned $12.85 million and $9.1 million, respectively. “Chainsaw Man – The Movie: Reze Arc” is based on the manga series about a demon hunter. It's another win for Sony-owned Crunchyroll, which also released a “Demon Slayer” film last month that debuted to a record $70 million.
The Federal Aviation Administration says flights departing for Los Angeles International Airport were halted briefly due to a staffing shortage at a Southern California air traffic facility. The FAA issued a temporary ground stop at one of the world’s busiest airports on Sunday morning soon after U.S. Transportation Secretary Sean Duffy predicted that travelers would see more flights delayed as the nation’s air traffic controllers work without pay during the federal government shutdown. The hold on planes taking off for LAX lasted an hour and 45 minutes and didn't appear to cause continued problems. The FAA said staffing shortages also delayed planes headed to Washington, Chicago and Newark, New Jersey on Sunday.
Boeing workers at three Midwest plants where military aircraft and weapons are developed have voted to reject the company’s latest contract offer and to continue a strike that started almost three months ago. The strike by about 3,200 machinists at the plants in the Missouri cities of St. Louis and St. Charles, and in Mascoutah, Illinois, is smaller in scale than a walkout last year by 33,000 Boeing workers who assemble commercial jetliners. The president of the International Association of Machinists says Sunday's outcome shows Boeing hasn't adequately addressed wages and retirement benefits. Boeing says Sunday's vote was close with 51% of union members opposing the revised offer.
The stunning indictment that led to the arrest of more than 30 people — including Miami Heat guard Terry Rozier and other NBA figures — has drawn new scrutiny of the booming business of sports betting in the U.S. The multibillion-dollar industry has made it easy for sports fans — and even some players — to wager on everything from the outcome of games to that of a single play with just a few taps of a cellphone. But regulating the rapidly-growing industry has proven to be a challenge. Professional sports leagues’ own role in promoting gambling has also raised eyebrows.
Tesla, the car company run by Elon Musk, reported Wednesday that it sold more vehicles in the past three months after boycotts hit hard earlier this year, but profits still fell sharply. Third-quarter earnings fell to $1.4 billion, from $2.2 billion a year earlier. Excluding charges, per share profit of 50 cents came in below analysts' estimate. Tesla shares fell 3.5% in after-hours trading. Musk said the company's robotaxi service, which is available in Austin, Texas, and San Francisco, will roll out to as many as 10 other metro areas by the end of the year.
