Tim Cook on Q1 2016

Tim Cook on Apple’s record-breaking quarter:

Good afternoon, everyone, and thank you very much for joining us. Today, we’re reporting Apple’s strongest financial results ever. We generated all-time record quarterly revenue of 75.9 billion dollars in the December quarter, in line with our expectations, and have 2 percent over last year’s blockbuster results.

This is a huge accomplishment for our company, especially given the turbulent world around us. In constant currency, our growth rate would have been 8 percent. Our record revenue and continued strong operating performance also led to an all-time record quarterly net income of 18.4 billion dollars. We sold 74.8 million iPhones in the December quarter, an all-time high. To put that volume into perspective, it’s an average of over 34,000 iPhones an hour, 24 hours a day, seven days a week for 13 straight weeks. It’s almost 50 percent more than our Q1 volume just two years ago, and more than four times our volume five years ago.

The big news, though, is that Apple’s forecast for this quarter has iPhone sales dipping year-over-year for the first time ever. Here’s why:

We see that Q2 is the toughest compare. We believe it’s the toughest compare because the year-ago quarter also had catchup in it from Q1; if you recall, we were heavily supply-constrained throughout the whole of Q1, and so some of that demand moved into Q2. Plus, we’re in an environment now that is dramatically different from a macroeconomic point of view than last Q2: from a currency point of view, from the level at which we’ve had to adjust pricing in several of these markets, and sort of the overall malaise in virtually every country in the world. It’s really all of those factors that play in there, and it’s difficult to sort out how much is due to which one.

★ Tuesday, 26 January 2016