Analyst: Appleâs record quarterly results had âno blemishesâ
Apple Inc. (AAPL) delivered a stellar performance in the fourth quarter of 2019, beating analysts' expectations on both revenue and earnings. The company reported revenue of $64 billion, up 2% year-over-year, and earnings per share of $3.03, up 4% year-over-year. The results were driven by strong demand for the iPhone 11 models, which were launched in September, as well as robust growth in services and wearables.
Wall Street analysts were impressed by Apple's results, which they described as having "no blemishes" [^1^]. Many analysts raised their price targets for the stock, with Morgan Stanley setting a new Street-high of $296, implying a 22% upside potential [^1^]. Analysts also praised Apple's guidance for the holiday quarter, which was higher than expected. Apple expects revenue of $85.5 billion to $89.5 billion and gross margin of 37.5% to 38.5% for the first quarter of 2020 [^2^].
Analysts were optimistic about Apple's prospects for the next year, citing several catalysts that could boost its growth. These include the potential launch of a low-cost iPhone SE2 model in early 2020, which could attract more customers in emerging markets and stimulate upgrades among existing users [^1^] [^3^]. Another major catalyst is the expected release of 5G-enabled iPhones later in 2020, which could trigger a new wave of demand for Apple's flagship product [^1^] [^3^]. Analysts also noted that Apple's services business, which includes Apple Music, Apple TV+, iCloud, and App Store, continues to grow at a robust rate and generate high margins. Services revenue increased 18% year-over-year to $12.5 billion in the fourth quarter [^2^]. Similarly, Apple's wearables segment, which includes AirPods, Apple Watch, and Beats products, saw a 54% year-over-year growth in revenue to $6.5 billion [^2^].
Apple's stock rose as much as 2.2% on Thursday, reaching near-record levels [^1^]. The stock has gained more than 40% since early June, outperforming the broader market and its peers. Apple is currently the most valuable company in the world by market capitalization, with a value of over $1.1 trillion .
[^1^] Apple Had âNo Blemishesâ as IPhone Demand Cheers Wall Street - Bloomberg
[^2^] Apple Reports Fourth Quarter Results - Apple
[^3^] Analyst: Appleâs record quarterly results had âno blemishesâ - MacDailyNews
AAPL Stock Price | Apple Inc. Stock Quote (U.S.: Nasdaq) | MarketWatch
Apple's CEO Tim Cook expressed his confidence in the company's performance and future outlook in a conference call with analysts. He said that Apple is "very optimistic about what the December quarter has in store" and that the company is "firing on all cylinders" . He also highlighted the positive customer response to Apple's new products and services, such as the iPhone 11, Apple TV+, Apple Arcade, and Apple Card. He said that Apple TV+, which launched on November 1, has already been watched by millions of viewers in over 100 countries . He also announced that Apple will provide a new metric for its services business starting from the next quarter, which is the number of paid subscriptions across its platforms .
Analysts also asked Cook about Apple's relationship with China, which is a key market for the company but also a source of uncertainty amid the ongoing trade war with the U.S. Cook said that he is "hopeful" that the U.S. and China will reach a trade agreement soon and that he does not expect any major impact from the tariffs on Apple's products . He also said that Apple's revenue from China increased sequentially and year-over-year in the fourth quarter, driven by strong iPhone 11 sales and growth in services and wearables . He added that Apple is "very proud" of its contributions to China's economy and society, such as creating jobs, supporting suppliers, and promoting education and environmental initiatives .
Apple's CFO Luca Maestri also shared some details about Apple's financial performance and capital allocation strategy. He said that Apple generated $19.9 billion in operating cash flow and returned over $21 billion to shareholders through dividends and share repurchases in the fourth quarter . He also said that Apple ended the quarter with $205.9 billion in cash and marketable securities, net of debt . He said that Apple plans to continue its share buyback program, which has reduced its outstanding shares by 7% in the past year . He also said that Apple intends to maintain a net cash neutral position over time .
Apple Had âNo Blemishesâ as IPhone Demand Cheers Wall Street - Bloomberg
Apple Reports Fourth Quarter Results - Apple
Analyst: Appleâs record quarterly results had âno blemishesâ - MacDailyNews
Apple Inc. (AAPL) Q4 2019 Earnings Call Transcript - The Motley Fool
AAPL Stock Price | Apple Inc. Stock Quote (U.S.: Nasdaq) | MarketWatch aa16f39245