Apple reports whopping US$49.6bn quarter, says little about Apple Watch

21 Jul 201523 Shares

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Apple reported phenomenal Q3 results of US$49.6bn in revenue and profits of US$10.7bn, but is circumspect about how Apple Watch performed

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Apple has been circumspect about the performance of its Apple Watch wearable except to say it got off to a ‘great’ start. The company reported a US$10.7bn profit on third quarter sales of US$49.6bn.

Apple reported third-quarter growth was fuelled by record numbers of iPhone and Mac products and strong revenue from services.

“We had an amazing quarter, with iPhone revenue up 59pc over last year, strong sales of Mac, all-time record revenue from services, driven by the App Store, and a great start for Apple Watch,” said Tim Cook, Apple’s CEO.

“The excitement for Apple Music has been incredible, and we’re looking forward to releasing iOS 9, OS X El Capitan and WatchOS 2 to customers in the fall.”

Combined the iPhone Apple Watch, Mac and App Store revenues drove growth of 33pc.

‘The excitement for Apple Music has been incredible, and we’re looking forward to releasing iOS 9, OS X El Capitan and WatchOS 2 to customers in the fall’
– TIM COOK

The US$49.6bn in revenues was up from considerably from the US$37.4bn that Apple reported this time last year and profits were up US$3bn from US$7.7bn reported last year.

Gross margin was 39.7pc and international sales accounted for 64pc of revenue.

“In the third quarter our year-over-year growth rate accelerated from the first half of fiscal 2015, with revenue up 33pc and earnings per share up 45pc,” said Luca Maestri, Apple’s CFO.

“We generated very strong operating cashflow of US$15bn, and we returned over US$13bn to shareholders through our capital return programme,” Maestri said.

Watching the watchmakers

There is no doubt that Apple’s third quarter was driven by the success of core products like its iPhone and Mac families, but all eyes are on the Apple Watch and whether it caught fire in the market.

Despite research showing high satisfaction levels among early adopters, the question is ultimately how much of them did Apple sell in their first sales period and will it be a leading device like the iPhone?

A report last June on Siliconrepublic.com estimated that 2.79m Apple Watches had been sold since its launch, but this surge appears to have waned.

According to new figures from Slice provided by MarketWatch, just three months later the company is now selling fewer than 10,000 per day worldwide in some instances.

However, only Apple really knows.

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Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com