Apple snapped out of a prolonged sales slump during its most recent quarter as the trendsetting company prepares to launch into the artificial intelligence craze with an arsenal of new technology that’s expected to juice demand for its next iPhone.
The fiscal third-quarter results announced Thursday covered an April-June period that’s typically a sluggish stretch for Apple as its loyal customer bases awaits the next version of the iPhone that’s traditionally unveiled shortly after Labor Day.
Even so, Apple boosted its sales from a year ago — a welcome reversal of fortune on the heels of five consecutive quarters of year-over-year revenue declines.
This time around, Apple’s revenue rose 5% from a year to $85.78 billion — a figure that exceeded analysts’ projections. The Cupertino, California, company earned $21.45 billion, or $1.40 per share, an 8% increase from the same time last year. The profit also topped analyst forecasts.
Apple's shares swung between slight increases and modest declines in Thursday's extended trading as investors assessed the results.
Sales of the iPhone — Apple’s marquee product — remained on a downward slope though, dipping 1% from last year to $39.3 billon. That decrease wasn’t as bad as the January-March period when iPhone sales plummeted 10% from last year, and now the product appears headed toward a major upswing.
That’s because Apple is planning to roll out a variety of artificial intelligence features that are supposed to make its virtual assistant Siri smarter and also perform a variety of helpful and fun tasks, including helping to draft texts and even creating unique emojis on demand. The AI tools will be included in a free software update expected in the autumn, but most of the features will only work on iPhones with a special chip that so far has only been available on two premium models Apple released last year.
The next model, the iPhone 16, is expected to be equipped with the AI chip — a factor that analysts believe will spur consumers who have been holding on to their older devices to splurge on upgrades so they can take advantage of the new features. That expectation is the main reason why Apple’s stock price has surged 13% since the company previewed its AI tools in early June — a run-up that has created about $400 billion in shareholder wealth so far.
“I believe it will be a very key time for a compelling upgrade cycle,” Apple CEO Tim Cook told analysts during a Thursday conference call.
Apple’s push into AI may also fuel its steadily growing services division, which saw its revenue climb 14% from last year to $24.21 billion in the most recent quarter. Although the services division has been thriving for years, it's confronting regulatory threats that could drag down its performance.
A lucrative deal that generates about $20 billion in revenue by making Google the default search engine on the iPhone and Safari browser is being targeted in a high-profile antitrust case that the U.S. Justice Department filed against Google. A federal judge is expected is to issue a ruling by the end of this year.
The Justice Department also is targeting Apple in a separate lawsuit that it filed in March, alleging the company is illegally locking out competition by erecting unnecessary barriers around the iPhone. Apple has adamantly denied any wrongdoing and launched an attempt to have the case dismissed in documents filed Thursday in New Jersey federal court.
That started a legal process that will take several more months to play out before the presiding judge decides whether to throw out the case or allow it to proceed in a ruling likely to come late this year or early next year.
As has been happening during much of the past year, Apple’s sales continued to erode in China — a worry for investors because the region is one of the company’s key markets. Apple’s revenue in China dropped 7% from last year in the past quarter.
FILE - Apple iPhone 15 ProMax phones are shown in an Apple store in Pittsburgh, on June 3, 2024. Apple reports earnings on Thursday, Aug. 1, 2024. (AP Photo/Gene J. Puskar, File)
KIEL, Germany (AP) — Jamal Musiala scored after 15 seconds and Harry Kane had a hat trick as Bayern Munich routed promoted Holstein Kiel 6-1 to continue Vincent Kompany's winning start as the coach on Saturday.
Musiala seized on defensive errors to score his club's third-fastest Bundesliga goal ever and Bayern was 3-0 up after just 13 minutes thanks to a precise finish from Kane and an own goal from Kiel's Nicolai Remberg.
Kane added another just before halftime and Michael Olise scored on a rebound in the 65th for his first goal since joining Bayern from Crystal Palace. Armin Gigovic salvaged some consolation with a goal for Kiel, which has lost all three of its league games since promotion, in the 82nd.
England captain Kane completed his hat trick from the penalty spot in added time after he was brought down by Carl Johansson. It was Kane's 40th Bundesliga goal from 35 games since joining Bayern last year.
Bayern is on a four-game winning run since Kompany took over for this season, three in the Bundesliga and one in the German Cup.
Bayern next plays Croatia's Dinamo Zagreb on Tuesday, Kompany's first game as a coach in the Champions League.
Victor Boniface scored twice as Bayer Leverkusen beat Hoffenheim 4-1 to rebound from a rare Bundesliga loss, but Leipzig dropped points for the first time this season in a 0-0 draw with Union Berlin.
Ahead of playing Feyenoord in its Champions League opener on Thursday, Leverkusen got back to winning ways after losing to Leipzig 3-2 in its last game. That was the first time Xabi Alonso's title-winning team lost in the Bundesliga for 15 months.
Boniface set up Martin Terrier for Leverkusen's first goal, and scored himself soon after, leaving defender Alexander Prass sprawled on the ground as he scored past goalkeeper Oliver Baumann.
Leverkusen's three games in the league have seen a combined 15 goals scored, in part because of lapses in concentration in defense that have frustrated coach Alonso.
Mergim Berisha's goal for Hoffenheim in the 37th minute cut Leverkusen's lead to 2-1 and Alonso's team nearly conceded another soon after. However, Leverkusen retook control after the break. A penalty from Florian Wirtz and another goal from Boniface ensured a 4-1 win.
It was the first time Boniface scored twice in a game since an adductor muscle injury ruled the Nigerian striker out of much of the second half of last season as Leverkusen won the title.
Union goalkeeper Frederik Ronnow frustrated Leipzig in a goalless draw, saving a penalty from Loïs Openda and a stoppage-time free kick from David Raum. Leipzig created few clear chances in a subdued performance ahead of Thursday's Champions League visit to Atletico Madrid.
Both teams were without their coaches as Leipzig's Marco Rose was suspended following a red card against Leverkusen and Union's Bo Svensson was ill.
New signing Ermedin Demirovic scored twice as Stuttgart — which visits Real Madrid on Tuesday — beat Borussia Moenchengladbach 3-1. Gladbach's Alassane Plea went off injured after colliding with goalkeeper Alexander Nübel while scoring his team's only goal.
Eintracht Frankfurt beat Wolfsburg 2-1 thanks to two goals from Omar Marmoush.
Junior Adamu scored twice in three minutes to give Freiburg a comeback 2-1 win over Bochum.
AP soccer: https://apnews.com/hub/soccer
Bayern's Harry Kane, left, holds back Kiel's Finn Porath during the German Bundesliga soccer match between Holstein Kiel and Bayern Munich, at the Holsten stadium in Kiel, Germany, Saturday, Sept. 14, 2024. (Gregor Fischer/dpa via AP)
Bayern's Harry Kane, right, is congratulated by Kingsley Coman after scoring during the German Bundesliga soccer match between Holstein Kiel and Bayern Munich, at the Holsten stadium in Kiel, Germany, Saturday, Sept. 14, 2024. (Gregor Fischer/dpa via AP)
Frankfurt's Omar Marmoush celebrates after scoring, during the German Bundesliga soccer match between VfL Wolfsburg and Eintracht Frankfurt, at the Volkswagen Arena, in Wolfsburg, Germany, Saturday, Sept. 14, 2024. (Swen Pförtner/dpa via AP)
Stuttgart's Ermedin Demirovic, second from left, scores his side's second goal during a Bundesliga match between Borussia Mönchengladbach and VfB Stuttgart, in the Borussia-Park Stadium in Mönchengladbach, Germany, Saturday, Sept. 14, 2024. (David Inderlied/dpa via AP)
Leipzig's Xavi Simons, left, and Berlin's Danilho Doekhi fight for the ball during a match between RB Leipzig and FC Union Berlin in Leipzig, Germany, Saturday, Sept. 14, 2024. (Hendrik Schmidt/dpa via AP)
Berlin goalkeeper Frederik R'nnow reacts on the pitch during a match between RB Leipzig and FC Union Berlin in Leipzig, Germany, Saturday, Sept. 14, 2024. (Hendrik Schmidt/dpa via AP)
Hoffenheim coach Pellegrino Matarazzo stands in the stadium before a match between TSG Hoffenheim and Bayer 04 Leverkusen on Saturday, Sept. 14, 2024 in Sinsheim, Germany. (Uwe Anspach/dpa via AP)
Hoffenheim coach Pellegrino Matarazzo, right, and Leverkusen's head coach Xabi Alonso greet each other before a match between TSG Hoffenheim and Bayer 04 Leverkusen on Saturday, Sept. 14, 2024 in Sinsheim, Germany. (Uwe Anspach/dpa via AP)
Leverkusen's goalscorer Florian Wirtz, middle celebrates with teammates after scoring during a match between TSG Hoffenheim and Bayer 04 Leverkusen on Saturday, Sept. 14, 2024 in Sinsheim, Germany. (Uwe Anspach/dpa via AP)
Leverkusen coach Xabi Alonso gives instructions during a match between TSG Hoffenheim and Bayer 04 Leverkusen on Saturday, Sept. 14, 2024 in Sinsheim, Germany. (Uwe Anspach/dpa via AP)
