Apple raked in record revenue of $64.7 billion for the September 2020 quarter, although that was up just 1% year-over-year. The tech giant’s Service business revenue rose 16%, to $14.55 billion in the period, also a record.
However, sales of Apple’s flagship iPhone plunged in the quarter — down 21% — ahead of the rollout of its latest iPhone 12 smartphones in October.
The tech company topped Wall Street estimates on the top and bottom lines, posting earnings per diluted share of 73 cents (a decline from 76 cents the year prior). Total net income was $12.67 billion, down about $1 billion from the year-earlier quarter.
International sales accounted for 59% of the quarter’s revenue, with growth in every region except Greater China, where sales plunged 29% to $7.95 billion. According to Apple, the China market was hardest hit by the absence of new iPhone models in the quarter.
Shares of Apple were down 4.5% in after-hours trading. Apple, the largest tech company in the world by market cap, posted lower growth overall than Big Tech peers Amazon, Google and Facebook did for Q3.
Apple’s most recent financial results don’t include sales of the new iPhone 12 line, its first 5G-enabled smartphones, which began shipping Oct. 23. During the September quarter, iPhone sales came in at $26.44 billion, down from $33.36 billion in the year-ago period.
CEO Tim Cook boasted of record revenue for Apple’s Service segment as well for its Mac computers — which generated sales of $9 billion (up $1.6 billion over its previous all-time high quarter) helped by a back-to-school promotion and people working from home during COVID. On the earnings call, Cook said customer demand for iPhones was up double-digits through mid-September; he noted that the company’s Oct. 12 unveiling of the iPhone 12 was later than it has announced new phones in past year.
“Despite the ongoing impacts of COVID-19, Apple is in the midst of our most prolific product introduction period ever, and the early response to all our new products, led by our first 5G-enabled iPhone lineup, has been tremendously positive,” Cook said.
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