Apple selling more services and wearables, but fewer smartphones
Despite falling smartphone sales, Apple on Wednesday posted solid quarterly revenue growth thanks to increasing sales of wearable gear, such as AirPods, and services.
Apple posted profits of $13.7 billion on revenue of $64 billion for its fiscal fourth quarter, topping analyst expectations of $62.7 billion. The tech giant was also bullish in its guidance ahead of the important holiday season. For the current quarter ending in January, Apple forecast revenue of $85.5 billion to $89.5 billion, in line with Wall Street forecasts.
"We're very optimistic about what the holiday quarter has in store," Apple CEO Tim Cook said in a statement.
Shares of the tech giant jumped 3%, to $250, after markets closed. Apple's stock price has risen 54% this year, compared with 22% for the S&P 500 index.
Sales of iPhones came in stronger than analysts expected, but still fell 9% in Apple's fourth quarter, to $33.4 billion from $36.8 billion during the same period last year.
Apple has been riding the smartphone revolution since 2007, but has been trying to offset the decline in iPhone sales by turning to services, such as a music subscription, credit card and streaming service.
On Friday, Apple will launch its new Apple TV service. But lukewarm early reviews of the $4.99 monthly service and a small content library suggest Apple does not hold a candle to entertainment powerhouses like Disney, HBO or Netflix.
"We feel stronger that consumers will not cancel Netflix for Apple TV Plus," Justin Patterson, analyst at Raymond James, wrote in a note.