Business news: Apple, the iPhone maker, unveiled a record share buyback program, sending its stock up 6 per cent in extended trade as the company’s quarterly results and forecast beat modest expectations on Thursday. Apple increased its cash dividend by 4 per cent and authorised an additional program to buy back USD 110 billion of stock, which is the largest in the company’s history. Apple's quarterly revenue fell and CEO Tim Cook said revenue growth would return to the current quarter.
The results indicate that the company may be regaining its footing in the smartphone market, despite tough competition and regulatory challenges. The increase in Apple’s shares following its report lifted its stock market value by over USD 160 billion.
Apple said fiscal second-quarter revenue fell 4 per cent to USD 90.8 billion, beating the average analyst estimate of USD 90.01 billion, according to LSEG data.
For Apple's current quarter, which ends in June, Cook told news agency Reuters that the iPhone maker expects "to grow low-single digits" in overall revenue. Wall Street expected 1.33 per cent revenue growth to USD 82.89 billion, according to LSEG data.
Long considered a must-own stock on Wall Street, Apple shares have underperformed other Big Tech companies in recent months, falling 10 per cent this year as it struggles with weak iPhone demand and tough competition in China.
Apple expects current-quarter services and iPad revenue to grow by double digits, CFO Luca Maestri told analysts on a conference call. The company expects gross margins of between 45.5 per cent and 46.5 per cent for the fiscal third quarter.
Apple faces a raft of challenges across its business. Smartphone rivals such as Samsung Electronics 005930.KS have introduced competing devices aimed at hosting artificial-intelligence chatbots.
On the regulatory front, Apple's services business, which contains its lucrative App Store and was one of the few areas of growth in the fiscal second quarter, is under pressure from a new law in Europe. In the United States, the Department of Justice in March accused Apple of monopolising the smartphone market and driving up prices.
For the fiscal second quarter, iPhone sales fell 10.5 per cent to USD 45.96 billion, compared with analyst expectations of USD 46 billion. Apple executives said in February that the year-ago fiscal second quarter had benefited from a USD 5 billion surge in iPhone sales as the company caught up from supply-chain snarls during pandemic lockdowns.
(With Reuters inputs)
ALSO READ | iPhone alarms are not working as expected: Here's what's happening and what Apple said
Latest Business News
