Apple‘s services business turned in double-digit growth for the first three months of 2024 — to reach a new record — but the tech giant’s core iPhone business suffered a decline and the company saw a continued sales drop-off in China.
The Apple Services segment generated $23.87 billion, up 14.2%, for the quarter ended March 30, topping analyst forecasts of $23.12 billion. For the calendar year-end 2023 quarter, the company reported $23.12 billion in services revenue. The services segment includes subscription services such as Apple TV+, Apple Music, Apple Arcade and iCloud; the App Store, Apple Pay and Apple Card; advertising; and payments from Google for search. Apple last fall raised the price of Apple TV+ to $9.99/month in the U.S., up from $6.99 previously.
Dragging down Apple’s results: Sales of iPhones, by far its biggest business line, fell 10.5%, to $45.96 billion. Sales in the company’s Greater China region, which includes Hong Kong and Taiwan, declined 8% in the period to $16.4 billion.
Overall, Apple came in just above analyst estimates. The company reported $90.8 billion in revenue, down 4.3%, and net income of $23.6 billion ($1.53 per share), a decline of 2.2%, for the March 2024 quarter. Wall Street expected the tech giant to post revenue of $90.04 billion and earnings per share of $1.50 for the period, which is its Q2 of fiscal 2024.
“Today Apple is reporting revenue of $90.8 billion for the March quarter, including an all-time revenue record in Services,” Apple CEO Tim Cook said in announcing the earnings. “During the quarter, we were thrilled to launch Apple Vision Pro and to show the world the potential that spatial computing unlocks.” On the call with investors, he didn’t speak to how well the $3,500 Vision Pro headset has sold since it began shipping in February.
Apple’s board authorized an additional program to repurchase up to $110 billion of the company’s common stock — the biggest buyback program in its history. The company also declared a cash dividend of 25 cents per share, up 4%, payable on May 16. Apple had $162.3 billion in cash, cash equivalents and marketable securities at the end of the quarter.
