Cook began tackling the test Tuesday with the release of Apple's quarterly earnings report, four weeks after rattled Wall Street by disclosing the company had missed its own revenue projections for the first time in 15 years - a time when the iPod was just beginning to transform Apple. Even though iPhone sales are struggling, Apple's services are bringing in more money than expected, giving investors some good news. "We're not taking our foot off the gas". That unexpected move raised suspicions that Apple was trying to hide a forthcoming slump in iPhone sales - fears that were realized during the holiday season. That unexpected move raised suspicions that Apple was trying to hide a forthcoming slump in iPhone sales - fears that were realized during the holiday season.
What's different now is that Apple is no longer disclosing how many iPhones it shipped after the quarter is completed, a change that Cook announced in November.
He said Apple is rethinking how it prices the iPhone outside the United States after largely setting the price in USA dollars, which made the phones more expensive in local currencies. The company's active installed base ended 2018 at an all-time high, with 1.4 billion devices. It said it now has 1.4 billion active devices, an increase of 100 million from previous year, and that 900 million of those are iPhones. According to the Times, Apple's starting pay for assembling products in China is $3.15 an hour-far less than the company would pay for the same labor in the United States.
Apple said it expects revenue between $55 billion and $59 billion for the current quarter ending in March, largely below analysts' average estimate of $58.83 billion, according to IBES data from Refinitiv.
Interestingly, Apple reported that its other businesses, collectively, grew by 19 percent. For nearly any other company but Apple, this would be an impressive number.
Another important source of income is the surging market for app downloads, where Apple gets 30 percent of the action.
The results for the October-December period were slightly above analysts' expectations that were lowered after Cook's January 2 warning.
People use their phones outside an Apple store in Beijing, China January 7, 2019. From the way Cook spoke during today's call, that sounds like a program will keep in place going froward. It plans to roll out those efforts to more countries. While Apple didn't comment on how that might impact its future iPhone strategy, those results might suggest there's a demand for both lower-priced iPhones as well as models with bigger screens that deliver more features.