Apple revenue declines but the stock surged post earnings report

Apple reported its earnings on October 30, 2019.  The released covers the fiscal fourth-quarter results. As expected, the report will give investors more insights into how Apple conducts its businesses and how thing will pan out in the near feature.

The revenue from IPhone sales, the Apple Credit card service and its service business will tell a lot about where the company is heading.

Apple’s fourth-quarter summary

Apple’s revenue was down 2 percent year over year as the IPhone sales revenue came in at 22 Billion. However, Apple CEO said Apple’s business grew at 18% year over year.

Key takeaways from Apple’s 4^th quarter report for the year 2019.

·      Services Revenue Reaches All-Time High of $12.5 Billion

·      EPS Sets New Fourth Quarter Record of $3.03

·      The Company posted quarterly revenue of $64 billion

·      Quarterly earnings per diluted share of $3.03, up 4 percent

Here is what the Apple CEO Tim Cook said during the earnings press conference “We concluded a groundbreaking fiscal 2019 with our highest Q4 revenue ever, fueled by accelerating growth from Services, Wearables and iPad,” said Tim Cook, Apple’s CEO. “With customers and reviewers raving about the new generation of iPhones, today’s debut of new, noise-cancelling AirPods Pro, the hotly-anticipated arrival of Apple TV+ just two days away, and our best lineup of products and services ever, we’re very optimistic about what the holiday quarter has in store.”

“Our strong business performance drove record Q4 EPS of $3.03 and record Q4 operating cash flow of $19.9 billion,” said Luca Maestri, Apple’s CFO. “We also returned over $21 billion to shareholders, including almost $18 billion in share repurchases and $3.5 billion in dividends and equivalents, as we continue on our path to reaching a net cash neutral position over time.”

Apple is providing the following guidance for its fiscal 2020 first quarter:

·       revenue between $85.5 billion and $89.5 billion

·       gross margin between 37.5 percent and 38.5 percent

·       operating expenses between $9.6 billion and $9.8 billion

·       other income/(expense) of $200 million

·       tax rate of approximately 16.5 percent

Apple stock price as of today.