Apple surprises Wall Street with record-breaking Q3 profits

Apple could become the world's first trillion dollar company today

Apple earnings beat expectations as it sells pricer iPhones

The higher revenue can be attributed to not just the increased iPhone sales, but also the fact that the average selling price of an iPhone is much higher than what it was a year ago.

The division grew revenues by 31 per cent in the quarter, with the success of apps such as the video game Fortnite believed to have contributed to the increase.

Apple is closing in on a $1 trillion market cap following a strong third-quarter earnings report that exceeded Wall Street's projections.

Propelled by the rise of Apple Music and app subscriptions, services have quickly become a major revenue contributor for the company.

Still, typically the three months ending in June happen to be the slowest in terms of iPhone sales and revenue, but the tech giant performed considerably well during a period where the majority of consumers might have decided not to upgrade thanks to the newest series being introduced after a couple of months.

"We're thrilled to report Apple's best June quarter ever, and our fourth consecutive quarter of double-digit revenue growth", said Tim Cook, Apple's CEO.

The firm said its £999 iPhone X - launched previous year - remained its most popular iPhone model in the quarter and had driven the higher selling prices.

More news: Homeless man hands out resumes, goes viral

Apple's figures also reflect increasing demand for products including Apple Watch, once considered a weak offering, but which sold around 3.5m units during the quarter, an increase of 30% year on year-on-year.

Apple's revenue guidance for Q3 2018 fell between $51.5 billion and $53.5 billion, with gross margin estimated to be between 38% and 38.5%.

Investors were watching closely to see if Apple would be entangled in the FAANG meltdown, which hammered shares of Facebook (FB) and Netflix (NFLX) last week in a broader sell-off.

The Cupertino, California-based technology giant is expected to announce fiscal third-quarter revenue of $52.3 billion, according to analyst estimates compiled by Bloomberg.

Apple's best-selling products do not yet face duties stemming from the US-China trade disputes, but US President Donald Trump has threatened hundreds of billions of dollars in further tariffs on product categories not yet been enumerated.

Another category potentially affected by tariffs is the Apple Watch, which is one of Apple's growth drivers.

Analysts on average expected Apple (AAPL) to post earnings of $2.16 per share, according to FactSet. And look out, Spotify: Apple Music grew over 50 percent since previous year, as did revenues from the company's cloud services. Services reached a record $9.55 billion, and is well on the way to a runrate of $14 billion per quarter by 2020, the company said.

Latest News