Apple released their results for the March quarter yesterday after the market closed, and the news was all good, sending the stock up 7 percent in after-hours trading. Not only did Apple's quarterly results beat Wall Street's most optimistic estimates, Apple announced several stock-related moves that thrilled investors: an unusual 7-for-1 stock split, an increase in the quarterly dividend, and an increase in their stock buyback program. Apple's results set a record for a March quarter. Analysts were expecting Apple to report $43.5 billion in revenue, but Apple handily exceeded that, coming in at $45.6 billion. The iPhone led the way, with Apple selling 43.7 million iPhones, well above Wall Street's estimate of 38.5 million. Strong iPhone sales were attributed in part to strong demand in China and emerging markets—where there remains a lot of potential for growth.
The only slight downside in the report was a 16 percent decline in iPad sales compared to a year ago, with sales of 16.4 million units. Still, Apple remains by far the biggest player in the tablet market. (Apple attributes the decline to unusually high sales in the March quarter last year because of a shortage of iPad minis during the Christmas season. Those who were unable to buy them waited and purchased them in the March quarter.) Apple also reported an increase in Mac sales at a time when PC sales are uniformly declining.
All in all, analysts and commentators are saying that all this reflects well on Apple CEO Tim Cook. And all the good news came at a time when many commentators were starting to write off Apple. With new products ahead, and Apple steadily on course in what is traditionally a weaker quarter, everything is looking up.
I think Apple will continue to grow, thanks in part to new product categories that are in the works. CarPlay is generating a lot of interest, and analysts expect a big demand for the larger iPhones. The arrival of an iWatch and a new Apple TV will also contribute to Apple's bottom line. Plus, Apple's services are increasingly contributing to their bottom line, and that will only grow.