Apple stock fell amid weak iPhone sales, iPhone 12 in focus
Apple stock price slid more than 4% after the company reported a substantial drop in iPhone sales. The company blames pandemic related problems along with a delay in the new iPhone release for the sales decline. Shares of the largest tech company are currently trading around multi months low.
Besides iPhone revenue, the company outperformed the trends with record services revenue of $14 billion. It’s Mac, iPad, and Wearables, Home and Accessories segments have topped analysts’ consensus estimates.
Slowing iPhone sales are looming on Apple stock performance
iPhone sales growth has been slowing over the past few quarters. The company has generated an iPhone revenue of $26.4 billion in the fourth quarter compared to a consensus of $28 billion.
iPhone sales also plunged sharply from past year sales of $33.3 billion.
The company has recently launched a series of new 5G supported iPhones including the iPhone 12 to improve the sales trend. The management believes sales are likely to gain momentum during the December quarter.
However, the company decided not to issue guidance as virus trends are increasing all over the world.
CEO Tim Cook said: “If you look at the case count, the case counts are climbing in Western Europe. They’re climbing in the United States. And so there’s still a sufficient level of uncertainty out there… we don’t believe that’s an environment to guide into.”
The portfolio expansion strategy is working
The company’s strategy of expanding its products and services portfolio is helping in improving the revenue base. It has generated record services revenue of $14 billion in the latest quarter while Mac revenue of $9.03 billion topped the consensus estimate for $7.93 billion. Apple’s iPad revenue came in at $6.79 billion, up from the consensus for $6.14 billion.
Apple stock price is likely to remain under pressure in days ahead as iPhone sales are likely to see pandemic related challenges. This is because the majority of European countries have imposed new social distancing policies.