Q1 2023: no Christmas magic for Apple’s results

The consequences of the various crises of recent years have hit Apple so far, but the legendary manufacturer’s impermeability is no longer there! We’ve had a taste of that with the previous quarter’s results, and the final 2022 results confirm that times are a little tougher.

With a turnover of 117.1 billion dollars achieved during the fourth quarter of 2022 (for Apple, this is the first fiscal quarter of 2023), it’s hard to complain about the company! The end of the year is always a great time for Apple which since 2021 has crossed the $100 billion threshold during this season. But here it is: turnover is down 5.5% over Q1 2022.

No more laughing for Tim.

The last three months of the year were marked by the launch of new tablets: the iPad Pro M2 which basically didn’t bring much to the range, the iPad 10 which shook up the family in the least awkward position, as well as two new Apple TV 4K with subtle changes.

In other words: not enough to generate crazy consumerist enthusiasm. This quarter also saw the launch of the iPhone 14 Plus in early October, as well as a very rare anniversary from Apple. In November, the manufacturer warned that there would be delays in shipping the iPhone 14 Pro. To make matters worse, Christmas is a defining period for smartphone sales…

in short

In billions of dollars.

K1 2023 K1 2022 Evolution
Substitution 117.1 123.9 -5.5%
profit 29.99 34.6 -13.4%
iPhones 65,775 71.6 -8.1%
iPads 9.39 7.2 +29.6%
mac 7.73 10.8 -28.7%
Service 20.76 19.5 +6.5%
Other products 13.48 14.7 -8.2%

Turnover and profit

During the third quarter of 2022 results, Luca Maestri, Apple’s chief financial officer, predicted a “slowdown” in sales and he was not wrong. Apple posted revenue of $117 billion in the final three months of last year, down 5% from the same period in 2021.

It was the first time since 2019 that turnover had fallen, and it was also the biggest revenue drop since September 2016. Apple was far below Wall Street’s consensus expectation of 121.2 billion. The company has exceeded this target for almost 7 years.

Profits took a hit too: of course, at 30 billion dollars Apple had no problems at the end of the month, it still represents a decline – a rarity in recent years – of 13.4%.

This respite is explained according to Tim Cook by the current complicated economic environment, by the strong dollar and production issues of the iPhone 14 Pro and Pro Max. However, the CEO stressed that “during this fourth quarter, ” We have reached an important milestone and are happy to announce that we now have over 2 billion active devices “. A year ago, the counter was 1.8 billion.

sales of iPhones

The iPhone clearly remains Apple’s cash cow and its trump card for decorating the Christmas tree. Again, unsurprisingly, this happened with sales of $65.7 billion. Fixed turnover fell by more than 8%.

The iPhone 14 range is popular, especially the 14 Pro actually and that’s good, they’re also the most expensive. Despite everything, the quarter was tough with these warnings of shipping delays due in large part to the difficulties faced by Foxconn.

This somewhat disappointing result across Apple still underlines, if necessary, the appeal of the iPhone lineup to consumers while the market takes a nosedive.

ipad sales

Since the start of the 2022 fiscal year, iPad sales have been at a loss. The tablet is a major sacrifice from Apple’s catalog, a manufacturer that favored production of the iPhone at the expense of the iPad during this component’s shortage period. The range received some love in the fourth quarter, with the launch of the new iPad Pro and iPad 10. Enough to bring the machine back to life? Looks like yes!

The turnover from this activity has indeed reached 9.4 billion dollars, which is almost 30% better than last year.

Mac Sales

In the fourth quarter, Apple announced nothing new to boost Mac sales — it took until January to see the new MacBook Pro and Mac mini. During previous results, Luca Maestri had warned of air pockets and he was right: Mac sales plunged 29%, with a turnover of 7.7 billion dollars. Therefore Apple paid cash for not having a new machine.

These dismal sales are part of the context of a truly depressed PC market after the euphoric years of the health crisis.

Other services and products

Apple continues to reap the rewards of the “everything for the service” strategy that Tim Cook loves so much. In the fourth quarter, this activity totaled 20.7 billion dollars, up 6.4% over last year (compared to 5% in the third quarter).

Luca Maestri underlined that the turnover of 20.7 billion for this service marks a new record. Meanwhile, Tim Cook announced – something very rare – that the Apple Pay Later function is currently being tested by employees and will be rolling out soon. This is a new type of payment service “buy now and pay later” (in installments).

Are other product categories also in good condition? Not too. With the Apple Watch Series 8/SE 2/Ultra and AirPods Pro 2 launching at the start of the school year, and also with two new Apple TV 4Ks available since October, one would think these new products would boost sales. end of the year, that’s not the case. This catch-all activity (including Beats products) recorded turnover of $13.5 billion, a significant decrease of more than 8%.

For more

For the first calendar quarter of 2023 (i.e. Apple’s fiscal second quarter), analysts expect revenue of $98 billion, slightly higher than the same period last year. The manufacturer no longer provides numerical forecasts for the current quarter since 2020 and the start of the pandemic.

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