Apple posted better-than-expected results for the third quarter but continued to report soft revenue. Cheddar News breaks it all down.

<div class="block">Apple posted better-than-expected results for the third quarter but continued to report soft revenue. Cheddar News breaks it all down.</div>

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Apple Tops Earnings Estimates But Slow Revenue Growth Continues

And Apple reported its latest quarterly earnings late yesterday. It revealed that consumers aren't buying as many new products as expected. So a new senior reporter Michelle Castillo is here to break it down. So Michelle, what do we know so far? Well, overall, Hannah Apple beat analyst estimates for earnings per share and revenue, but there were some lackluster sales results that had investors worried. So Apple earned $1.46 per share and brought in revenue of $89.5 billion during the fourth quarter of 2023. But it's important to note that its revenue was down from last year this time marking about 12 months of straight declines and its product sales all came in under projections except for the iphone sales which actually did come in in line with estimates that was up 2% compared to last year, but that also only included a week of iphone 15 sales since those just came out in September. But other categories like wearables, computers, ipads, they all came in a lot lower. Hannah Max sales in particular were down 34% year over year. Apple CFO had warned last quarter that Mac and ipad sales were expected to decline. And this time, Apple Ceo Tim Cook also pointed out it was hard to compare this year to last year because in 2022 Apple was coming off a huge supply chain disruption. Cook believes it led to a boost in sales during the final quarter of that year. He also added he was bullish that the new line of Mac computers with the M three chips could increase future sales. Apple has been facing increased competition from Chinese manufacturers, Michelle, you've been reporting on that a lot. So what could this mean for future sales? Well, China has a host of companies manufacturing smartphones including Huawei technologies and with early reports saying that the Chinese government was barring or not encouraging its employees to use Apple products. Many investors are worried that Apple may lose market share in this huge market. Chinese iphone sales came in at $15 billion this past quarter. That's well below the analysts estimate of $17 billion. Cook did try to downplay these fears. In an interview with Reuters. He pointed out that Apple had four of the top five best selling smartphones in urban China. Research from analysts also shows that overall smartphone sales fell 3% in China this summer due to economic conditions, but Apple seems to have actually gained market share during that time. Cook also said in an earnings call that it expects to sell more iphones in China this holiday quarter than last year, even though there is one less week than last year. But it wasn't all bad news. Right. Its services division did better than expected. Yes. So services has continued to be a bright spot for the company services revenue came in at 22.31 billion versus the $21.35 billion estimate. So Apple services division includes subscription products. You might think like your Apple TV, plus Apple music and icloud. It also encompasses its warranties like Apple care app store purchases and its payment system with its Apple credit card and product payment plans. But pretty significantly, it also includes things like Google's agreement with Apple to be the default search engine on Safari. That deal was estimated to be worth $19 billion this year. According to analysts now, Apple CFO said in an earnings statement that the number of Apple devices in current use hit an all time high this quarter. So this could lead to even more growth in Apple services division in the future, Michelle Castillo. Thank you so much.