Apple CEO Tim Cook said the company remains optimistic of its financial future despite the global impact of the coronavirus pandemic.
In its Q2 results, Apple has reported a 1pc year-on-year increase in quarterly revenue, totalling $58.3bn, with revenue growth slowing compared to the previous quarter. Apple’s total cash reserves now amount to $192.8bn, down from $207.1bn at the end of the previous quarter.
The company said it achieved record earnings of $13.4bn in its services segment – which includes iCloud, Apple Music, Apple TV+ and other subscriptions. This was a 16pc increase on the same time last year.
There are now 515m subscribers to Apple’s various platforms, up 125m from a year ago. The company now expects to reach its target of 600m subscriptions by the end of 2020.
While wearables revenue increased from $3.6bn to $3.9bn, iPhone revenue fell by 7pc year on year from $31bn to $28.9bn.
Speaking on a call with analysts, Apple CFO Luca Maestri warned: “On iPhone and wearables, we expect the year-over-year revenue performance to worsen in the June quarter relative to the March quarter.
“On iPad and Mac, we expect the year-over-year revenue performance to improve in the June quarter.”
What the future holds
Regarding the issue of its stores – with many still closed around the world – Apple CEO Tim Cook said that despite store traffic not being what it was, online sales have been “pretty phenomenal”.
“Retail had a quarterly record for us during the quarter, and that’s despite stores being closed for the three-week period around the world, excluding China,” he said.
“Whether that’s a permanent shift, I would hesitate to go that far as I think people like to be out and about.”
Cook also said that given the lack of “visibility and certainty in the near term”, the company will not be issuing guidance in the coming quarter. He assured shareholders that Apple has a “high degree of confidence” the business will continue to grow.
“Our global supply chain is profoundly durable and resilient. We have shown the consistent ability to meet and manage temporary supply challenges like those caused by Covid-19,” Cook said.
“For a company whose business is innovation, there are real upsides in periodically having to figure out how to do just about everything in a brand new way.”
In its quarterly results earlier this week, Samsung said it expects that sales of TVs and smartphones are likely to “decline significantly” as Covid-19 takes its toll on demand and leads to store and plant closures around the world.