The company’s expectations of slower growth on Tuesday overshadowed Apple Inc.’s massive third quarter. , which led to a decline in its record results and pushed stocks to the south.
Apple reported its strongest June quarter ever on Tuesday, with nearly double its gain and outpacing the iPhone — iPhone revenue beat Wall Street expectations by a staggering $5 billion. But the celebration came to a grinding halt when Apple Chief Financial Officer Luca Maestri said on a conference call that the company’s revenue growth would slow in the current quarter due to foreign exchange rates, semiconductor shortages and tougher comparisons with the previous year.
“We expect very powerful year-over-year revenue growth during the September quarter,” Maestri said, while continuing to avoid precise revenue guidance due to uncertainty related to the COVID-19 pandemic. “We expect revenue growth to be below the June quarterly growth of 36%.”
Apple shares were up in following-hours trading up to that point, but they immediately fell back and eventually ended the extended trading session down 2%.
In addition to overall revenue, Maestri was also warned about one of Apple’s most significant companies and declined to donate any hints about prolonged dips in sales growth.
“We expect our services growth rate to return to a more exemplary level,” Maestri said, referring to Apple’s services business, which hit record revenue in the quarter with 33% growth to $17.5 billion.
He added that this growth rate also benefited from a positive comparison as some services were significantly affected by the onset of COVID-19 lockdowns a year ago.
“We expect significant growth in services, but not at the level we saw in June,” he said in response to a interrogate about the company’s guidance.
When asked about the upcoming holiday period, and whether the shortage of semiconductors and components will have an impact on Apple’s typically larger quarter, Maestri said he wants to talk about just one quarter at a time. Some analysts were already questioning whether the second half of this year would be as powerful as the first half among tech companies, especially tech giants, and Apple’s June quarter seemed to reflect those concerns.
While it seems ridiculous to see stocks plummet following reporting such a staggering quarter — iPhone revenue alone totaled nearly $40 billion, CEO Tim Cook said 5G penetration remains “very low, so we’re really satisfied.” About the coming of the iPhone” – Fears that we are at the height of technology are valid. And while the delta variable continues to create uncertainty about the course of the COVID-19 pandemic, there is more uncertainty ahead.
As Cook put it on Tuesday, “The road to recovery will be winding.”