Apple reports largest annual quarterly revenue dip since 2016

[Shawn Knight]

What just happened? Apple just turned in one of its worst quarterly earnings reports in years. For the three-month period ending December 31, 2022, Apple posted quarterly revenue of $117.2 billion which is down more than five percent from the $124 billion generated in the year-ago period.

Apple's big moneymaker, the iPhone, saw revenue dip to $65.8 billion in Q4 compared to $71.6 billion during the same period a year earlier. The Mac category brought in $7.7 billion, down from $10.9 billion year over year, and the wearables / home / accessories category fell to $13.5 billion from $14.7 billion.

iPad sales increased year over year, from $7.2 billion in Q4 2021 to $9.4 billion this past holiday season. Similarly, Apple's services category went from $19.5 billion to $20.8 billion.

CEO Tim Cook acknowledged the challenging environment it and others continue to navigate, but focused on the positives in Apple's accompanying press release. Cook highlighted the fact that Apple now has more than two billion active devices globally. Furthermore, the services business set an all-time revenue record in Q4.

In an interview with CNBC, Cook pointed to three key factors that hurt Apple's results: production issues in China affecting the iPhone 14 Pro and iPhone 14 Pro Max, a strong dollar and the overall macroeconomic environment.

Share value in Apple is up 3.7 percent in early morning trading on the report.

Apple did not offer guidance for the coming quarter. In fact, the iPhone maker hasn't provided guidance since the start of the pandemic in 2020. Analysts told CNBC they expect Apple to generate around $98 billion in Q1 2023.

Apple recently brought back a version of its full-size HomePod smart speaker complete with updated internals and a $50 lower price point. The company's long-rumored AR/VR headset could also break cover this year, perhaps at Apple's annual WWDC with a fall launch window. New iPhones are pretty much a given for September but don't expect to see updated iPads this year as those are reportedly being saved for 2024.

Image credit: Hugo Agut Tugal, Zhiyue

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https://www.techspot.com/news/97487-apple-reports-largest-annual-quarterly-revenue-dip-since.html

 

[StrikerRocket]

Well, good for them... I guess, but it's not thanks to my money!

 

[WhiteLeaff]

Slowly people will free themselves from the apple mindshare and see that there are many options on the market, of which the iPhone is just one more, plus, that at least in the last 5 years the best smartphones are the "mid-end" ones below U$ 500, the flagships give up features and battery size/capacity (the most important point) in exchange for huge cameras and thin designs that bring little or no real advantage in everyday use.

 

[Kashim]

I would expect this to be the start of a trend. At some point people will stop buying an expensive new phone every year. There are no new "must have" features any more when new phones get released, it's just small incremental improvements to features they all already have.

 

[SixTymes]

Biden's massive inflation continues to ripple out to every market affecting all goods in every industry.

 

[scavengerspc]

Biden's massive inflation continues to ripple out to every market affecting all goods in every industry.

Since it's a global problem, I would like to hear how he did it all by himself.

Back on topic

The pandemic recovery was bound to set itself right. Apple just announces it's the latest victim.

 

[Endymio]

Since it's a global problem, I would like to hear how [Biden] did it all by himself.

I'm glad you asked. Since the US dollar is the reserve currency for most of the world, it's inflation affects most everyone. Still, the US rate went from 1.1% to a high of 9.1% -- a nearly 900% increase, much faster than the world average. Also note that a nation like China -- working to replace the dollar with the yuan as a reserve currency -- saw far lower increases. China currently stands at only 1.8% Inflation.

 

[scavengerspc]

I'm glad you asked. Since the US dollar is the reserve currency for most of the world, it's inflation affects most everyone. Still, the US rate went from 1.1% to a high of 9.1% -- a nearly 900% increase, much faster than the world average. Also note that a nation like China -- working to replace the dollar with the yuan as a reserve currency -- saw far lower increases. China currently stands at only 1.8% Inflation.

I'm not sure if you remember brother, but we have been through this exact thing before. And still, the timeline of Global Inflation is completely wrapped in current events. NOT the US dollar. In fact I would argue that the US dollar was adversely effected by the war among other things. And I have already pointed out that in the UK, among others, inflation peaked at 11%.

And let's face it. China is not terribly dependent on the western worlds' economy.
In fact, isn't it more the other way around?

How China's Stock Market Affects US Indexes

China has taken center stage as regulators attempt to intervene in a market that seems determined to fall. Here's how China's Stock Market Affects US Indexes:...

www.wiseradvisor.com

 

[Endymio]

I'm not sure if you remember brother, but we have been through this exact thing before.

I certainly do remember, my friend, and while I doubt I'll change your mind, the figures below are impossible to explain away:

US dollars in circulation:
Jan 2020: $4.02 trillion.
Jan 2021: $6.07 trillion.
Jan 2022: $20.35 trillion.

When you quintuple the amount of dollars available to spend on the same number of goods and services, prices invariably rise. Nations besides the US that saw large inflation increases also were those that (a) use the dollar as a reserve currency, and (b) pursued similar "easy-money" policies, such as most of the OECD. Nations like China, which did NOT do this, saw no large increase in inflation.

As Nobel-winning economist Milton Friedman says, "inflation is, always and everywhere, a monetary phenomenon".

Finally your link on China is interesting, but irrelevant. It doesn't even suggest that China's policies affect inflation here in the US.

 

[scavengerspc]

I certainly do remember, my friend, and while I doubt I'll change your mind, the figures below are impossible to explain away:

US dollars in circulation:
Jan 2020: $4.02 trillion.
Jan 2021: $6.07 trillion.
Jan 2022: $20.35 trillion.

When you quintuple the amount of dollars available to spend on the same number of goods and services, prices invariably rise. Nations besides the US that saw large inflation increases also were those that (a) use the dollar as a reserve currency, and (b) pursued similar "easy-money" policies, such as most of the OECD. Nations like China, which did NOT do this, saw no large increase in inflation.

As Nobel-winning economist Milton Friedman says, "inflation is, always and everywhere, a monetary phenomenon".

Wait. I wouldn't argue any of this. All I'm saying is that our inflation problems, as well as inflation worldwide over the last year, is not heavily tied into those facts and figures.

We all knew when the pandemic started lifting that there were going to be problems with the world economy. But the war, with global threats to food and fuel supplies, is what sent us spinning.

Finally your link on China is interesting, but irrelevant. It doesn't even suggest that China's policies affect inflation here in the US.

Strongly disagree, in that what I was pointing to in that write up was how China can have as heavy an influence on our economy, if not more, than we do on theirs.