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iPhone, Mac and services deliver record quarter for Apple

Apple posted quarterly revenue of $49.6bn, up by 33% compared with a year ago, while quarterly net profit was up by 39% to $10.7bn

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Apple has reported a strong quarter ending 27 June 2015, driven by record sales of iPhone and Mac, record revenue from services and the launch of Apple Watch.

The company posted quarterly revenue of $49.6bn, up by 33% compared with the same period a year ago, while quarterly net profit was up by 39% to $10.7bn.

Apple sold 47.5 million iPhones in the quarter, up by 35% on the same period in 2014, while Mac sales were up by 9% to 4.8 million, but some analysts noted that iPhone sales were below forecasts of 48.8 million, which was not well received by investors.

“We had an amazing quarter, with iPhone revenue up 59% over last year, strong sales of Mac, all-time record revenue from services, driven by the App Store, and a great start for Apple Watch,” said Apple CEO Tim Cook.

“The excitement for Apple Music has been incredible, and we’re looking forward to releasing iOS 9, OS X El Capitan and watchOS 2 to customers in the fall,” he said.

Luca Maestri, Apple’s chief financial officer, said the company generated very strong operating cash flow of $15bn and returned more than $13bn to shareholders through its capital return programme.

Apple’s board of directors declared a cash dividend of 52 cents a share payable on 13 August 2015.

Despite the strong results, shares fell by 6.7% in after-hours trade in New York, reports the BBC.

Analysts blamed the fall on disappointment about the lower than expected iPhone sales in the past quarter and the company’s revenue forecasts for the current quarter of $49bn to $51bn, which is shy of the market forecast of $51.1bn.

Analysts said investors were also concerned that Apple’s profits are too heavily dependent on the iPhone, with sales of iPad tablets down by 18% compared with the same quarter a year ago.

Apple also gave no exact figures for sales of the Apple Watch, but Cook said the company’s first wearable technology had a “great start” since it went on sale in April 2015.

Apple Watch earnings were lumped together with other products such as the iPod and Beats headphones, which collectively came to $2.6bn, up by $952m compared with the same period in 2014.

However, giving the first indication of the Apple Watch’s performance, Maestri said that revenue from the watch amounted to "well over'" the $952m increase and had exceeded the initial sales of the iPhone and iPad.

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The article was more balanced than this summary portrays. As the author pointed out, analysts are skeptical of the Apple Watch's success due to the company's hesitancy to share sales figures. I've also seen many commentators criticize Apple Music as lacking innovative features. The underlying concern that seems to be in every article these days is "when will Apple have the next iPod, iMac, iPhone, etc.?" So many recent announcements have been lukewarm and Apple needs to make a splash soon if they want bloggers and analysts to swoon again.
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