Apple reduced their Q1 guidance (they report results on Jan 29). Revenue guidance was reduced almost entirely on weaker performance in emerging markets, particularly with iPhones in Greater China. AAPL expected some weakness in emerging markets, but it turned out to have a significantly greater impact than they had projected. In a letter to investors Tim Cook pinned this on trade tensions and a weakening economy in China. “Market data has shown that the contraction in Greater China’s smartphone market has been particularly sharp” – so likely not just an Apple issue. Service segment revenues in China were strong and installed base of devices grew.
Overall, Services generated over $10.8 billion in revenue during the quarter, growing to a new quarterly record in every geographic segment, and is on track to achieve their goal of doubling the size of this business from 2016 to 2020.
$AAPL.US
[category Equity Research]
[tag AAPL]
Sarah Kanwal
Equity Analyst, Director
Direct: 617.226.0022
Fax: 617.523.8118
Crestwood Advisors
One Liberty Square, Suite 500
Boston, MA 02109