On Thursday (28th), Apple announced its second-quarter financial results for the 2022 fiscal year after the market. Driven by strong demand for the iPhone and digital services, revenue hit a record high for the same period in the same period, and announced plans for treasury shares and additional dividends. But top executives warned that supply chain bottlenecks stemming from the coronavirus lockdown could dent revenue by as much as $8 billion this quarter (in the third quarter), clouding bright earnings and sending shares lower after hours.
Apple said the lockdown measures that have affected China in recent weeks have affected shipments of some key devices.CFO Luca Maestri warns of multiple challenges this quarter, with Covid-19-related supply chain bottlenecks likely to cost $4 billion to $8 billion in revenue and consumer demand in China likely to be affected by the lockdown .
Apple Chief Executive Tim Cook also said that “Apple is not immune to supply chain challenges.” The company did not provide guidance for the current quarter, continuing its practice so far in February 2020.
Regarding inflation, Maestri said that consumer demand for Apple’s various products, especially the iPhone, exceeded the company’s expectations at the beginning of the second quarter, but inflation is affecting consumer spending.
After the financial report was released, Apple once rose by more than 2% after the market, but after warning of supply chain problems, it fell sharply and fell by more than 4%. The decline converged to about 2% before the deadline.
Apple closed up 4.52 percent at $163.64 a share earlier on Thursday. Apple is down 7.8% this year as tech stocks have been under selling pressure of late.
F2022 Q2 (until 3/26) financial report key figures vs. Refinitiv analyst expectations
- Diluted EPS: $1.52 vs. $1.43
- Net revenue: $97.278 billion (8.59% y/y) vs. $93.89 billion
- Gross Margin: 43.7% vs. 43.1%
End product performance vs. Refinitiv analyst consensus
- iPhone revenue: $50.57 billion (+5.5% y/y) vs. $47.88 billion
- Mac revenue: $10.435 billion (+14.73% y/y) vs. $9.25 billion
- iPad revenue: $7.646 billion (-1.92% y/y) vs. $7.14 billion
- Other product revenue (including AirPods and Apple Watch): $8.806 billion (+12.37% y/y) vs. $9.05 billion
- Services revenue (including iCloud, Apple Music): $19.821 billion (+17.28% y/y) vs. $19.72 billion
Sales by region
- Americas: $40.882 billion (+19% y/y)
- Europe: $23.287 billion (+4.6% y/y)
- Greater China: $18.343 billion (3.4% YoY)
- Japan: $7.724 billion (0.2% y/y)
- Asia Pacific Others: US$7.042 billion (6.7% y/y)
Apple’s second-quarter revenue and profit both outperformed market expectations, demonstrating the ability of its products to be immune to environmental headwinds. Among them, the iPhone’s performance grew by about 5%, and the iPhone SE launched in the second quarter contributed, and the digital service, which Apple regards as a growth engine, delivered double-digit performance growth.
Macs continued to sell well, with Apple launching the high-performance Mac Studio desktop computer in the second quarter, but most orders were delayed due to supply chain shortages, long customization times, and high demand. The new MacBook Pros are another big contributor, albeit with the same supply chain issues.
Although Apple has launched new tablets, including an updated entry-level iPad, new iPad mini and iPad Air, the iPad’s second-quarter revenue fell, which is also the least profitable of Apple’s major products. Some consumers have complained that iPad software features can’t keep up with hardware performance.
For the wearables segment, Maestri said sales of the Apple Watch and AirPods were still good, but because of seasonal changes in demand for other accessories, revenue from wearables fell short of market expectations.
Apple also revealed that exchange rate headwinds and the timing of product launches in various regions were not synchronized, affecting revenue in Japan and the Asia-Pacific region.
Apple said its board of directors has authorized a $90 billion treasury stock plan. In addition, Apple will increase its dividend by 5% to $0.23 per share, following a tradition of increasing shareholder returns on the occasion of its second-quarter earnings report.