Apple Reaches Over 1 Billion Paid Subscriptions as Services Revenue Hits Record in Q3

Lucas Manfredi
·2 min read
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Apple beat Wall Street expectations on Thursday after reporting net income of $19.8 billion, or $1.26 per share, on revenue of $81.8 billion for its third fiscal quarter of 2023. Analysts surveyed by Zacks Investment Research were expecting earnings of $1.19 per share on revenue of $81.4 billion.

The tech giant’s Products segment posted revenue of $60.5 billion. The iPhone generated $36.7 billion in net sales, while the Mac, iPad and Wearables, Home and Accessories categories posted net sales of $6.84 billion, $5.79 billion and $8.28 billion, respectively.

The company’s Services segment posted revenue of $21.2 billion. The Services segment does not break out sales figures by category, but includes Apple TV+, Apple Arcade, Apple Fitness+, Apple News+ and Apple Music, along with cloud storage and hardware warranties.

“We are happy to report that we had an all-time revenue record in Services during the June quarter, driven by over 1 billion paid subscriptions,” Apple CEO Tim Cook said in a statement. “And we saw continued strength in emerging markets thanks to robust sales of iPhone.”

During the quarter, Apple generated operating cash flow of $26 billion and returned over $24 billion to its shareholders. Apple shares slipped 2% in after-hours trading Thursday following the earnings announcement.

During the tech company’s earnings call, Cook touted Apple TV+’s “spectacular showcase of imaginative storytelling,” including the streaming service’s new series like “Hijack” and “Silo” alongside returning shows like “Foundation” and “The Afterparty.”

“In [the] few years since its launch, Apple TV+ has earned more than 1,500 nominations and 370 wins,” Cook said during the call. “That includes the 54 Emmy Award nominations across 13 titles that Apple TV+ received last month.”

Cook also turned his attention to the “exciting time” for the streamer’s sports offerings, pointing to Apple TV+’s partnership with MLS, which comes as soccer legend Lionel Messi joined the league last month.

“We’re focused on original content… with TV+ and so we’re all about giving great storytellers the venue to tell great stories and hopefully get us all to think a little deeper [and] sport is a part of that because sport is the ultimate original story,” Cook said during the earnings call. “We could not be happier with how the partnership is going. It’s clearly in the early days, but we’re beating our expectation in terms of subscribers and the fact that Messi went to Inter Miami helped us out there a bit.”

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