Apple Inc. Disappoints On Sales, IPhone Units

Apple Inc. (NASDAQ:AAPL) released the earnings results from its first quarter of fiscal 2016 after closing bell tonight, posting earnings of $3.28 per share and sales of $75.9 million. Analysts had been expecting earnings of $3.23 per share and $76.59 billion in revenue. In last year’s first quarter, the iPhone maker reported earnings of $3.06 per share and $74.6 billion in revenue.

Going into tonight’s report, Apple Inc. shares stubbornly refused to stay above $100 as investors remained cautious going into the print.

AAPL – iPhone fears confirmed

Management had guided for between $75.5 billion and $77.5 billion in revenue. International sales were 66% of total revenue. Greater China revenue was $18.4 billion, while Americas revenue was $29.3 billion. Basic earnings per share for the quarter were $3.30.

Apple Inc. shipped 74.8 million iPhones during the holiday shopping quarter, with Wall Street estimates running in the 74 million to 76 million range, representing a 1 million increase at the midpoint, although many analysts were predicting a unit decline. iPhone revenue was better than expected, however, at $51.64 billion, compared to the consensus of $51.3 billion.

The slight surprise in iPhone revenue is notable because a recent survey indicated that older iPhone models were fairly popular among buyers who preferred to save some money on a new iPhone because there wasn’t enough of a differentiation between the iPhone 6s lineup and the iPhone 6 line. Apple shipped 16.1 million iPads for $7.1 billion in revenue. “Other Products” revenue, which includes the Apple Watch and Apple TV, climbed from $3.05 billion last year to $4.35 billion this year.

Gross margin was 40.1%, a slight increase from the 39.9% recorded in the previous year’s first fiscal quarter.

Apple management issues March quarter guidance

Apple management said they expect between $50 billion and $53 billion in revenue for the March quarter, coming up short of the consensus estimate of $55.64 billion. They project a gross margin of 39% to 39.5% for the quarter.