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Apple highlights services because iPhone revenues continue to fall


The Apple logo has a body shape outside of an Apple store.

Today, Apple shared its fiscal results for the second quarter with shareholders. After a tumultuous first quarter that made Tim Cook CEO review company assistance weeks before the profit statement was made public, investors and analysts were looking for Apple to disclose some good news, especially About iPhone sales, your business services and the situation in China. .

Apple came out somewhat on these fronts, but overall, its results report for the second quarter of 2019 is a mixed package. The company earned $ 58 billion in revenue this quarter, which is at the highest end of its expected income spectrum (between 55 and 59 billion dollars), but with a decrease of 5% year-on-year. IPhone sales accounted for $ 31 billion of this total, down from $ 37.5 million in the same quarter of 2018.

The stock of Apple increased more than 4% after obtaining the profit report, which pushed the company to a value of one trillion dollars.

Manage the decline of the iPhone

In general, other segments of Apple products have made a good success in this quarter. IPAD sales revenues increased from $ 4,000 million in 2Q from 2018 to $ 4,800 million in the second quarter of 2019. The category of laptops, home and Apple accessories also experienced gains: from 3 , 9 million dollars at 2Q 2018 to 5.1 billion this quarter.

Mac sales revenues experienced a slight decrease over the previous year. Cook attributed this decrease to "processor limitations," but the CEO also said that these restrictions should not make long-term Mac sales. But, as expected, the Apple service business reached a record high of $ 11.5 billion in revenue this quarter, compared to $ 9.8 million during the same period of the previous year and above the total income of the first quarter of 2019 million dollars.

After years of detailing the growth of iPhone sales, Cook described the decline in revenues for iPhone sales in this quarter as "significantly less than the previous quarter" . Cook pointed out that the most difficult months of the recent memory for iPhone sales were November 2018 and December 2018, and the company's goal is to "pick up the pace" to accelerate iPhone sales in the future.

While users can keep their iPhones longer, Apple cited a positive and positive response to their change and financing programs. After launching new programs in the U.S., China, UK, Spain, Italy and Australia, Apple saw four times the exchange volume in March 2018. This means that customers can buy new iPhones if they can get some money delivering their existing phones or if they can choose a financing option that works for them.

At the end of last year, Apple explained that it would not announce the sales of iPhone units per quarter, a decision that frustrated some, but makes sense for Apple's bottom line . In contrast, the company announced in its results of the first quarter of 2019 that its global installation base includes 900 million of iPhone and the current benefits report shows that the installation base The company's membership is made up of 1,400 million devices. Instead of focusing on how many new iPhones have sold, Apple now wants to focus on how many iPhones are outside the world to prove their immense business capability.

Services and China

Apple is waiting for its number of new services to be appealing to many iPhone users. In a March event, the company announced Apple News +, a subscription program for news and magazines; Apple Arcade, a subscription service for games; and Apple TV +, a television streaming subscription program. The first of the three is now available for $ 10 a month, but the last two will debut in the fall.

All these new efforts, along with existing Apple services, represent a large part of the company's future. Cook described the "exceptionally exceptional experience" that Apple is trying to achieve with its devices and services. The company hopes that it can keep users in the Apple ecosystem offering services similar to its hardware: easy to use, targeted details, and focused on privacy and security.

How to get Apple TV + and Apple Arcade are not clear, but Apple's existing services are already strengthening this effort. Currently, Apple has 390 million paid subscriptions to its entire portfolio of services: an increase of 120 million subscriptions paid at this time last year and an increase of 30 million from the previous quarter. Cook did not destroy this subscriber number, but as of the last quarter, Apple Music had 50 million subscribers paid.

On the subject of China, the country continues to face struggles for Apple, as the company experienced a decrease in sales revenue last year. This quarter, sales in Great China produced revenues of 10.2 billion dollars, above the total income of 13 billion dollars in the second quarter of 2018.

However, Apple's leadership is still optimistic about its efforts in China. Tim Cook again cited the popularity of Apple's new options for trading and financing, which have been very successful both in China and in other countries. Cook also explained that price adjustments to have a weaker currency have had a positive effect in the region, as well as stimulus programs created by local governments and a better trade dialogue between the United States and China.

Many analysts investigated Apple on its recent agreement with Qualcomm, where companies reached an agreement to dismiss all litigation after a day in court. The agreement resulted in a multi-year licensing and licensing agreement in which Apple will continue to use Qualcomm chips on its devices. Cook did not offer more details about the solution, he only said that the company "is happy to put the litigation behind us."

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