Apple gave the financial report for the third quarter of 2019, which reported a decline in profit by 13%. Despite the fact that Mac and wearable devices, the company demonstrated a good performance, all the attention of analysts is focused on the iPhone, the sales of which have fallen so much that the proceeds from their sales amounted to less than half of the revenue for the entire company.
In the third quarter of 2019 Apple’s revenue was $53.8 billion, an increase of 1% over the previous year. Thus the profit of the company declined by 13%.
The volume of sales of the iPhone fell by 12%, and revenue was $25.9 billion, compared to $29.4 per last year.
Thus, for the first time since 2012, the sales of iPhones was less than half of the total revenue of Apple.
Attention financial analysts will be on to the next report, as it will include sales of the next iPhone line, and probably proceeds from two new services for the subscription — Apple TV+ Apple Arcade. However, given the unfortunate trend in revenue from sales of iPhones, which once was the most popular product of the company, Apple’s only hope for a wearable device.
In addition, before the publication of the report there is information about the fact that all three models of iPhone sample 2020 will have the support 5G. This fact has prompted social media users to the idea that iPhones 2019 to buy is not necessary, as they won’t represent anything innovative. Given this information, the September lineup of the iPhone is unlikely to please Apple records.
“Apple reported a revenue growth of 1% to $of 53.81 billion while reducing net profit by 13%. Both figures beat expectations: revenue by almost 1%, and earnings per share by 4%. The company revised its estimates for revenue to $billion 61-63 Main driver of growth in financial indicators suddenly Apple has provided the Mac and iPad, sales of which rose 10% and 8% respectively. The volume of iPhone sales fell by 12%,” — said “Газете.Ru” Vadim Merkulov, the Director of the analytical Department of the IR “freedom Finance”.
Revenue from services, which will be one of the main drivers of growth for Apple after 2021, increased by 12.6% to $11.5 billion, marking the lowest pace in 2015, which casts doubt on the financial potential of this segment.
For 2018, 65% of the company’s revenues came from sales of smartphones and 15% from services and for a complete transformation of the structure of revenues revenues from this segment is expected to grow at least twice.
Sales of the Apple Watch, AirPods and other related devices in the reporting period increased by an impressive 48%, exceeding the sales of the iPad and almost caught up with Mac.
“I believe that the sales of this product category will become the third largest source of revenue in 2020 fiscal year. Accessories at margin superior to any other segment of the company’s business, to prevent a serious drop in profits. However, growing spending on research (+15% yoy during the quarter) and sale of mobile business to Intel will lead in the next two to three years to reduce the margin to 18-19%. Despite the deteriorating situation, Apple will continue to generate cash flow due to the transformation of your business. The target price for the shares of the company until the end of the year $226”, — said Merkulov.
Last week it became known that Apple made a deal with Intel for the purchase of the modem business of the company for $1 billion Given that Yabloko wanted to start producing their own chips, it can be called a good acquisition.
The new unit will also help Apple to better prepare for the introduction of 5G in 2020.
Despite the fact that by that time the market will be iPhones, which are likely to be equipped with modems from Qualcomm, it is possible that in the future “Apple” will be able to produce their chips, becoming more independent from others.
In addition, their own modems will allow Apple to ensure proper synchronization of the hardware and the software.
However, some analysts believe that Apple twisted Intel’s hands, forcing him to sell the business for a pittance.
Rob Enderle of the Enderle Group, told Business Insider that Intel was in “a terrible position for negotiations”, as was trying to get rid of unprofitable divisions and was not in a position to bargain with Apple.
“Intel basically gave away their intellectual property for $1 billion And this amount is much less “billions”, which was originally predicted,” — said Bernstein Research analyst Stacy Rasgon.
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