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Apple’s Fiscal Q2 2017 Results Are In – Falls Just Shy of Expectations

Apple’s Fiscal Q2 2017 Results Are In – Falls Just Shy of Expectations

Apple on Tuesday announced its financial results for the second quarter of fiscal 2017. The iPhone maker earned $52.9 billion in revenue, for an $11 billion profit, showing year-over-year growth. However, iPhone sales were down from a year ago.

The company shipped 50.8 million iPhones in the March quarter, down from the 51.2 million shipped in the same quarter one year ago. Despite that downside, Apple delivered slightly higher than expected profits, for earnings of $2.02 per share.

While iPhone sales were down, revenue was up slightly, thanks to sales of the flagship iPhone 7/iPhone 7 Plus handsets. Apple’s Services business revenue was up 18% over one year ago. The “Other Products” category – which includes the Apple Watch, AirPods and beats products – also showed a 31% increase in revenue.

iPad sales declined again, selling 8.9 million units, while Mac sales were 4.2 million units for the quarter, up from 4 million a year ago.

“We are proud to report a strong March quarter, with revenue growth accelerating from the December quarter and continued robust demand for iPhone 7 Plus,” said Tim Cook, Apple’s CEO. “We’ve seen great customer response to both models of the new iPhone 7 (PRODUCT)RED Special Edition and we’re thrilled with the strong momentum of our Services business, with our highest revenue ever for a 13-week quarter. Looking ahead, we are excited to welcome attendees from around the world to our annual Worldwide Developers Conference next month in San Jose.”

Apple also announced that its Board of Directors has authorized an increase of $50 billion to the Company’s program to return capital to shareholders and is extending the program timeframe by four quarters. Under the expanded program, Apple plans to spend a cumulative total of $300 billion by the end of March 2019.

“We generated strong operating cash flow of $12.5 billion and returned over $10 billion to our investors in the March quarter,” said Luca Maestri, Apple’s CFO. “Given the strength of our business and our confidence in our future, we are happy to announce another $50 billion increase to our capital return program today.”

The Board has approved a 10.5% increase to the Company’s quarterly dividend, and has declared a dividend of $0.63 per share of the Company’s common stock, payable on May 18, 2017 to shareholders of record as of the close of business on May 15, 2017.

Apple is providing the following guidance for its fiscal 2017 third quarter:
  • revenue between $43.5 billion and $45.5 billion
  • gross margin between 37.5 percent and 38.5 percent
  • operating expenses between $6.6 billion and $6.7 billion
  • other income/(expense) of $450 million
  • tax rate of 25.5 percent