Apple looks to have overcome the supply chain crisis as it posted record revenues in its latest quarterly earnings report. The tech giant’s revenues shot up 11% to record $123.9 billion which made it the largest-ever single quarter in terms of revenue. All of which showed that Apple has kept growing despite the ravages of the ongoing pandemic that had closed down some of the brand’s offices as well as a number of Apple stores.
While analysts expected yet another positive report with an estimated earnings of $118.7 billion, Apple managed to defy expectations once more with the sheer scale of its success. The good news caused the Apple share price to rise by 5% in the day’s extended trading.
Reasons for Apple’s success include a rapidly growing demand for iPhones in China, and several innovative solutions to the supply chain crisis that has dogged many other tech brands. While chip shortages hampered Apple’s ambitions last fall, the firm’s manufacturing base appears to have shrugged off such issues.
There was also success in terms of a late surge in iPhone sales during the festive season. This was accompanied by a string of new models introduced including new versions of the iPad, Apple Watch, AirPods and the latest MacBook Pro. Only the sales of iPads disappointed from these, and this was blamed on supply chain constraints.
It’s an impressive result for Apple as tech companies were supposed to be among those hardest hit by the current economic climate. With rising inflation and the threat of at least three interest rate hikes in 2022, investors have been expected to stay away from riskier assets such as technology stocks. But these figures from Apple suggest that the tech industry could have the strength to survive the tricky market conditions. Much will be revealed when other big tech brands like Tesla and Amazon release their forthcoming reports.
Where will Apple go from here?
Apple has been reluctant to provide any official guidance for future quarterly reports since the pandemic struck citing uncertainty as the main reason. However, the Apple CEO Tim Cook did suggest that the brand should continue to enjoy a ‘solid year-on-year revenue growth’ for the March quarter. He also said that he expected the supply chain difficulties to be much less severe compared to what the brand experienced towards the end of 2021.
While Apple introduced a successful new range of models last quarter, the brand is expected to forge ahead with its other services such as iCloud, Apple Music and App Store. Such services contributed $19.52 billion and rose by an impressive 25%.
As such, Apple is looking strongly poised for the remainder of 2022. While Cook did mention that Apple was starting to see the effects of inflationary pressure and there are concerns about looming antitrust legislation, the tech giant’s cult following should have the strength to sustain such challenges.