by Felix Richter, Apr 29, 2022
Following a strong end to 2021 that saw Apple shatter its previous sales and profit records in the holiday quarter, the world’s most valuable company carried that momentum into 2022. On Thursday, the iPhone maker delivered yet another earnings beat that saw its revenue increase by 8.6 percent despite heavy headwinds in the form of silicon shortages, Covid-19, supply chain disruptions and inflation woes.
Apple posted double-digit growth in three of its product categories, with Services once again the biggest growth driver. The company’s services reached an all-time revenue record of $19.8 billion last quarter, thanks to an ever-growing installed base of active devices and paid subscriptions growing to 825 million across all services.
“We are very pleased with our record business results for the March quarter, as we set an all-time revenue record for Services and March quarter revenue records for iPhone, Mac, and Wearables, Home and Accessories,” Luca Maestri, Apple’s CFO said in the company’s earnings release, while also warning of the challenges ahead. In a conference call with investors, Maestri said that he expects the impact of supply constraints caused by Covid-related disruptions and industry-wide silicon shortages to be in the range $4 to $8 billion this quarter, while Covid’s impact on consumer demand in China and the suspension of operations in Russia are also expected to weigh heavily on Apple’s short-term results.
As the following chart shows, the iPhone accounted for just over half of Apple’s revenue last quarter, with the company’s services now the second largest contributor to overall sales. With net income for the first six months of its fiscal year standing at $59.6 billion, Apple looks likely to hit $100 billion in profit for the first time this year.
