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US tech group Apple generated slightly more in its second business quarter than in the same period last year, despite factories closing due to the coronavirus pandemic and falling sales in China. The growing services business was able to offset the decline in iPhone sales.
Sales jumped 1 percent to $ 58.3 billion in the three months through March 28, with iPhone sales stagnant after Apple closed its stores, first in China and then worldwide. Earnings decreased approximately 3 percent to $ 11.25 billion, or $ 2.55 per share. However, the numbers exceeded analysts’ revised forecasts, which were expecting sales of nearly $ 55 billion. Before the pandemic broke out, market watchers expected sales of more than $ 63 billion.
The strategic change of companies to sell more software and services paid off. Service revenue rose nearly 17 percent to $ 13.35 billion in the quarter, more than offset the 3.4 percent decline in production of hardware such as iPhones, iPads and Macs. With these products, Apple delivered $ 44.97 billion.
Apple announced that it would add $ 50 billion to its ongoing share buyback program. That’s less than last year’s $ 75 billion increase. Still, it is an encouraging sign that Apple wants to return capital to its shareholders, even though buybacks in the United States are currently controversial. The quarterly dividend increases by 6 percent.
Apple made up for declines in Chinese business with strong sales in the United States and Europe, where closings only began in the last weeks of the March quarter. However, the group may face an unprecedented drop in sales there due to the economic slowdown caused by the pandemic.
NASDAQ-listed Apple stock obtained after the exchange, in official trade, then changes its sign. More recently, the decrease was 1.29 percent to $ 289.95.
By Tripp Mickle
NEW YORK (Dow Jones)
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Image sources: Arsenie Krasnevsky / Shutterstock.com, NoDerog / iStock
