Apple Stock Rises on Optimism for New iPhone Sales

Apple Stock Rises on Optimism for New iPhone Sales
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Apple projected revenue in the current quarter that topped analysts’ estimates, signaling the company is optimistic about potential sales of the new iPhone models, according to Bloomberg.

Fiscal fourth-quarter sales will be $61 billion to $64 billion, the company said in a statement. Analysts, on average, estimated $61 billion, according to data compiled by Bloomberg. Apple’s projection at the high end is a 1.7% increase from the period a year earlier.

The forecast suggests the company anticipates that its next iPhone lineup, which won’t be a major change from the 2017 and 2018 models, and increasing revenue from services will be strong enough to return the company to growth. Apple typically puts its new iPhones on sale toward the end of the fourth quarter.

Apple reported that sales in the period ended June 29 gained 1% to $53.8 billion from a year earlier, beating analysts’ estimates of $53.4 billion. Shares jumped about 4% in extended trading after closing at $208.78 Tuesday in New York. The stock has gained 32% this year. Net income was $10 billion, or $2.18 a share, in the fiscal third quarter, compared with $11.5 billion, or $2.34 a share, a year earlier.

Despite holding a glitzy launch event in March previewing four major new services, the company has only managed to roll out one so far, Apple News+, which has not been as successful as the company projected. CEO Tim Cook confirmed on a conference call that a branded credit card will launch in August. Cook also said that thousands of Apple employees have been testing the Apple Card. Those services still mostly require the iPhone.

Services revenue reached $11.5 billion in the period, a quarterly record, but short of analysts’ estimates of about $11.9 billion. iPhone revenue was about $26 billion in the quarter, falling short of analyst projections of $26.5 billion. That’s a strong year-over-year decline from last year’s $29.5 billion.

iPads generated sales of $5.02 billion, meeting projections of $5 billion from analysts. Mac revenue was $5.82 billion, topping estimates of $5.4 billion and an increase from last year’s $5.3 billion. The company said it had $5.52 billion in wearables revenue. That’s an increase from $3.7 billion a year ago and topped analyst projections of $4.85 billion.