Apple's solid earnings send the stock soaring
SAN FRANCISCO - Apple's (AAPL) earnings climbed 12 percent to $8.7 billion in the company's latest quarter amid rising demand for iPhones, while the iPad snapped out of a 3-1/2-year sales slump.
Revenue increased 7 percent from last year to $45.4 billion.
The fiscal third-quarter results announced Tuesday exceeded analysts' projections for the period spanning from April to July 1.
Just as important, Apple forecast that revenue for its current quarter ending in September will range from $49 billion to $52 billion. That's better than Apple's performance last year when its popular line of iPhone 7 phones came out.
The upbeat forecast is likely to ease concerns that production problems might delay the release of Apple's next-generation iPhone. Most believe an upgraded version of the iPhone 7 will likely hit in September, but a real upgrade may face delays.
There's little suspense left about what the next iPhone will look like. That's because a river of rumors -- and a leak from Apple itself -- give us a pretty good picture of what the iPhone 8 looks like.
If the release of the next iPhone was going to be delayed until October or even later, analysts were expecting Apple to lower its revenue projections for the current quarter to below $45 billion.
Luca Maestri, Apple's chief financial officer, declined to comment on the timing of the next iPhone during an interview with The Associated Press.
Besides a bigger and better screen, the next iPhone is expected to include wireless charging and facial recognition technology to unlock the device, based on software coding that Apple mistakenly leaked.
People are still snapping up the iPhone 7 and iPhone 7 Plus that came out last September, according to Maestri. He said those models are the main reason Apple sold 41 million iPhones in the past quarter, a 2 percent uptick from last year.
In a long-awaited turnaround, Apple sold 11.4 million iPads in the quarter, a 15 percent increase from last year. It's the first time Apple's quarterly sales of iPads have improved from the previous year since the opening three months of 2014. Maestri cited Apple's efforts to sell more iPads in classrooms as the main reason for the comeback.
Apple CEO Tim Cook likes to crow about the services business, which include its $10-a-month Apple Music subscription, iCloud storage, iTunes music and its cut of revenue from the App Store. Unlike the ups and downs of hardware sales, it tends to grow as more people use more Apple products.
That unit saw revenue rise 22 percent to $7.3 billion.
And sales of its "other products," which include the Apple Watch, AirPods, Beats headphones and other accessories, rose 23 percent to $2.7 billion. The company hasn't broken out sales of its individual products, including the closely watched Apple Watch.
Apple shares have increased 30 percent since the beginning of the year, while the Standard & Poor's 500 index has climbed 11 percent. In the final minutes of trading on Tuesday, shares hit $150.05, an increase of 41 percent in the last 12 months.
Immediately after the earnings release, the stock jumped more than $9, or more than 6 percent, hitting a new record high of $159.