News ID: 233689
Published: 0910 GMT November 02, 2018

Apple falls below $1 trillion despite revenue and profit rise

Apple falls below $1 trillion despite revenue and profit rise

Apple briefly lost its $1 trillion valuation when its shares fell seven percent in after-hours trading despite posting record results.

The tech giant's strategy of charging more for its phones has paid off, with revenues jumping in the last three months despite relatively flat sales.

Revenues rose 20 percent to $62.9 billion year-on-year, and profits rose 31 percent to $14.1 billion.

But a warning of possible weaker sales in coming months sparked a share price slide after official trading ended.

The sell-off accelerated after Apple said it would stop disclosing the number of units sold.

Apple executives defended their decision, arguing that the figures are no longer good indicators of the firm's financial health.

Analysts, however, warned that outsiders may view it as a move that masks less sunny performance.

The total number of smartphones sold by all makers globally declined for the first time in 2017.

But Apple's strategy of charging higher prices for its phones has helped it to shrug off flagging demand.

The firm sold 46.9 million iPhones in the quarter to end-September, a modest rise on the 46.7 million sold for the same period last year.

The California-based company is also making more money from ‘services’ such as the App store, Apple Music and Apple Pay. Services revenue hit a record $10 billion in the quarter.

For the firm's full 2018 financial year, profits increased 23 percent to $59.5 billion, as revenue rose 16 percent to $265.5 billion.

"I can reassure that it is our objective to grow unit sales for every product category that we have," Apple's chief financial officer Luca Maestri told financial analysts.

"A unit of sale is less relevant today than it was in the past."




Despite the record figures, shares in the firm sunk in after-hours trading, falling by four percent and then by more than seven percent, before starting to rebound.

The decline was blamed in part on a disappointing forecast for the important Christmas season.

Apple said it expects sales of $89 billion to $93 billion for the quarter that ends 31 December, against Wall Street's $93 billion forecast.

It posted sales of $88.3 billion in the quarter last year.

Chief executive Tim Cook said that Apple is "seeing some macroeconomic weakness in some of the emerging markets" such as Turkey, India, Brazil and Russia.

He said some of that is due to currency fluctuation.

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