Apple shares rose in premarket trading after the iPhone maker announced a record share buyback program after second-quarter profits beat Wall Street expectations.
Apple announced Thursday that its board of directors has approved a $110 billion stock buyback. This is a 22% increase over last year’s $90 billion approval. bloomberg Previously reported.
The move is the largest share buyback ever announced in U.S. history.
In 2018, Apple approved $100 billion in stock buybacks, nearing a new record, Bloomberg reported, citing data compiled by market research firm Billingyi Associates dating back to 1999. .
Apple also announced that its revenue for the three months ended March 30 reached $90.8 billion. Although it was down 4.3% from the same period last year, it exceeded analysts’ expectations of $90.3 billion.
The results were a relief to investors, as Apple has seen sales decline in five of the past six quarters in the face of a tough smartphone market in China, Bloomberg reported.
Last month, Apple overtook Samsung as the world’s No. 1 mobile phone maker, according to the latest data from research firm IDC.
Apple shares rose 7% in after-hours trading on Thursday after the earnings report, and continued into Friday’s premarket trading, with the company’s shares up more than 6%.
Apple did not provide formal guidance for the remainder of fiscal 2024, but in an earnings call with analysts, finance chief Luca Maestri said iPad sales this quarter will see double-digit year-over-year growth. He said he expected it.
The services segment, which includes subscriptions, warranties, license fees and Apple Pay functionality, is also expected to continue to grow, Maestri said.
Additionally, Apple reported net income of $23.64 billion ($1.53 per share), down 2% from $24.16 billion ($1.52 per share) in the year-ago period.
Sluggish sales of the iPhone also contributed to the decline.
Apple CEO Tim Cook said: CNBC It said fiscal second-quarter sales were difficult to compare to 2023, when the company realized that iPhone 14 sales were delayed by $5 billion due to supply issues caused by the coronavirus.
“If you subtract that $5 billion from last year’s results, we grew this quarter on a year-over-year basis,” Cook said, according to CNBC. “This is what we think internally based on the company’s performance.”
Apple said iPhone sales fell nearly 10% to $45.96 billion, suggesting weak demand for its newest iPhones, the 15 Pro and Pro Max models, launched in September. .
Sales of other Apple products, such as the Apple Watch and AirPods headphones, also fell 10% year over year to $7.9 billion.
The decline came as no surprise to analysts.
Meanwhile, Mac sales rose 4% to $7.45 billion. Cook attributed this growth to the upgraded M3 chip found in the company’s new MacBook Air models as of March.
The new chip promises to give Apple’s coveted Mac laptops sharper 1080p webcams, support for faster Wi-Fi networks, and up to 18 hours of battery life, according to CNBC. .
The actual laptop design is the same as previous models, but the new M3 chip now allows users to add up to two external displays, an improvement over a single screen. However, to support two screens the laptop’s lid must remain closed, otherwise it will work with only one.
