By Stephen Nellis, Max A. Cherney and Yuvraj Malik
(Reuters) – Apple reported a smaller-than-expected drop in quarterly revenue on Thursday, and Chief Executive Tim Cook told Reuters the company expects a return to sales growth in the quarter ongoing, as it invests in AI features that will be unveiled in the coming months.
Apple increased its cash dividend by 4% and authorized an additional $110 billion stock buyback program. This buyout is the largest in the company’s history, according to Investing.com analyst Thomas Monteiro.
Apple shares jumped about 7% in extended trading after the report was released.
Apple’s results suggest the company could regain a foothold in the smartphone market, despite fierce competition and regulatory challenges.
Long considered a must-have stock on Wall Street, Apple stock has underperformed other big tech companies in recent months, falling 10% this year, due to weak iPhone demand and tough competition in China .
Apple said its second-quarter revenue fell 4 percent to $90.8 billion, beating analysts’ average estimate of $90.01 billion, according to LSEG data.
For Apple’s current quarter, which ends in June, Cook told Reuters the iPhone maker expects “single-digit growth” in overall revenue. Wall Street expects revenue to grow 1.33% to $82.89 billion, according to LSEG data.
Apple faces many challenges in its business. Smartphone rivals such as Samsung Electronics have introduced competing devices intended to host artificial intelligence chatbots.
On the regulatory front, Apple’s services business, which includes its lucrative App Store and was one of the few areas of growth in the fiscal second quarter, is under pressure from a new law in Europe. In the United States, the Department of Justice in March accused Apple of monopolizing the smartphone market and driving up prices.
For the fiscal second quarter, iPhone sales fell 10.5% to $45.96 billion, compared to $46 billion expected by analysts. Apple executives said in February that the second quarter of the previous fiscal year benefited from a $5 billion increase in iPhone sales as the company made up for supply chain losses during lockdowns. pandemics.
Excluding this one-time phenomenon, iPhone sales declined only slightly as the Cupertino, California-based company’s flagship product faced stiff competition. In China, Huawei Technology has gained market share.
Cook said iPhone sales were still seeing “growth in some markets, including China.”
But Apple’s revenue decline in China was not as sharp as analysts expected, with Greater China sales of $16.37 billion for the fiscal second quarter ended March 30, down 8 .1% and above analyst expectations of $15.59 billion, according to data from Visible Alpha.
Apple has said little about its plans for artificial intelligence, the technology that rivals Microsoft and Alphabet’s Google are banking heavily on. The company began increasing its research and development spending last time…
