Apple Revenue Eased Again Last Quarter As Rising Services & IPhone Sales Couldn’t Offset Dips Elsewhere

The world’s most valuable company narrowly topped estimates but saw another revenue dip — its fourth in a row — with sales down about 1% to $89.5 billion for its fiscal fourth quarter.

EPS at $1.46 was up 13% percent year-on-year for the three months ended in September, also a beat. Yet investors had hoped for a bit more from the tech giant, which saw its shares dip 1% after the bell. Apple stock, which has seen a massive run-up this year, closed 2% higher at about $177 for the session.

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Revenue from iPhones, about half of Apple‘s total business, was $43.8 billion, up from $42.6 billiion, and a record. The September quarter included about a week of new iPhone 15 sales.

Mac and iPad sales fell — Mac down by 33% to $7.4 billion, and iPad by 10% to $6.4 billion. Revenue for Wearables, Home & Accessories eased 3% to $9.3 billion.

Services, the fast-growing division that houses Apple TV+ alongside Apple Music, Apple Fitness, Apple Arcade, Apple Podcasts, Apple Books, Apple Cloud and the Apple App Store among others, saw sales of $22.3 billion, up from $19.2 billion last year — the bright spot for the quater.

Apple last month raised the price of a handful of subscription services led by Apple TV+, which will now cost $9.99, up from $6.99. An annual subscription moves from $69 to $99. Apple News+, Apple Arcade gaming and Apple One bundles will see prices rise n the U.S. and select international markets. Announcing the move, Apple said it’s “focused on delivering the best experiences possible for our customers by consistently adding high-quality entertainment, content, and innovative features to our services.

Earnings are hitting with the company in the midst of a major original theatrical film push. Martin Scorsese’s Killers Of The Flower Moon with Paramount releasing, which premiered at Cannes, has grossed $43 million domestic ($87 million worldwide) since its Oct. 20 release. Napoleon by Ridley Scott and starring Joaquin Phoenix hits theaters Nov. 22 through Sony Picture Releasing and is set to open the Thanksgiving frame at $24 million.

Apple TV+ saw all time viewership earlier this year with Ted Lasso, Silo and The Last Thing He Told Me. It’s currently rolling out Season 3 of popular The Morning Show.

“Today Apple is pleased to report a September quarter revenue record for iPhone and an all-time revenue record in Services,” said CEO Tim Cook. “We now have our strongest lineup of products ever heading into the holiday season, including the iPhone 15 lineup and our first carbon neutral Apple Watch models, a major milestone in our efforts to make all Apple products carbon neutral by 2030.”

“Our active installed base of devices has again reached a new all-time high across all products and all geographic segments, thanks to the strength of our ecosystem and unparalleled customer loyalty,” added CFO Luca Maestri. “During the September quarter, our business performance drove double digit EPS growth and we returned nearly $25 billion to our shareholders, while continuing to invest in our long-term growth plans.”

Investors are focused on its outlook for iPhone 15 in the current quarter, which is usually Apple’s largest with the holiday shopping season, and on what happened to Mac and iPad sales. Apple had warned in August that it expected revenue their decline on tough comp with a strong 2022 quarter that saw sales popped after prior supply chain issues.

The market’s also been jittery around China, including competition from Huawei, Apple’s Chinese rival, and the government’s investigation of Apple’s Chinese manufacturing partner Foxconn amid reports that the state is looking to ban foreign technology from government agencies. On a post earnings call Cook said he’s highly optimistic the growth potential in China, which he considers a “an incredibly important market” for Apple.

This week, Apple announced that that new chips will power its personal computers.

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