Apple Beats The Street On Strong Services Revenue, AAPL Tracking Towards All-Time High And $1T Market Cap

tim cook
AAPL is heading towards new highs after Apple posted strong earnings for fiscal Q3 2018. Revenue jumped 17 percent year-over-year to $53.3 billion while earnings per diluted share increased 40 percent to $2.34. The company's net income for the quarter came in at $11.5 billion.

During the quarter, Apple shipped 41.3 million iPhones, which was a slight increase over the 41 million it shipped during the same quarter last year. However, it should be noted that iPhone revenue increased a staggering 20 percent year-over-year from $24.8 billion to $29.9 billion. This can be directly attributed to the iPhone X, which Apple still says is currently its best-selling iPhone model.

To give you an idea of how big an impact that iPhone X had on revenue, consider the company's average selling price (ASP) for all iPhones. During fiscal Q3 2017 -- before the iPhone X launched -- the ASP for all iPhones was an enviable $605. However, for fiscal Q3 2018, that figured ballooned to $728. Given that the iPhone X starts at $999, you can see why the ASP has been reaching new highs.

iphone x 8

iPad sales were up slightly from 11.4 million to 11.6 million, but revenue for the segment went down from $4.97 billion to $4.74 billion. Analysts were expecting sales of 11.8 million. 

MacBook sales tumbled from 4.3 million a year ago to 3.7 million in fiscal Q3, while the $5.3 billion in revenue generated was 4.7 percent lower. Apple blames the lower sales on the fact that the 2018 MacBook Pro refresh arrived later this year, so those sales figures weren’t included in the Q3 tally.

Although Apple didn't break out individual sales numbers for its wearables (i.e., Apple Watch, AirPods), revenue from these devices grew by 60 percent during the quarter.

However, the star of the show for Apple was its services business, which includes revenue from the App Store, Apple Music, iCloud and Apple Pay (among others). Revenue from this unit rose 31 percent to $9.19 billion -- analysts were expecting Apple to hit $8.5 billion.

“We’re thrilled to report Apple’s best June quarter ever, and our fourth consecutive quarter of double-digit revenue growth,” said Apple CEO Tim Cook. “Our Q3 results were driven by continued strong sales of iPhone, Services and Wearables, and we are very excited about the products and services in our pipeline.”

AAPL is currently up 4.21 percent to $198.42 as it tracks towards an all-time high of $200 and a market cap of $1 trillion.