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Apple Stock: 2 Key Takeaways From Earnings Day

On fiscal second quarter earnings day, Apple delivered impressive results across the board. Here are 2 key takeaways from AAPL earnings report.

On April 28, once again, $AAPL delivered outstanding results. The Cupertino company posted impressive revenue growth of 54% and EPS of $1.40 that lavishly beat consensus of $0.98.

The stock ended the day down -0.6% during the regular session and up +2.2% in after-hours trading, for a net gain of about 150 basis points over the S&P 500. Below are two takeaways from earnings day that summarize the company's performance and the stock's after-hours price action.

Apple Financial Results Q2 2021

Figure 1: Apple Financial Results Q2 2021.

#1 No weakness to be found

Apple presented outstanding fiscal second quarter numbers. There was not material weakness to be found anywhere. All product and geographic segments were up year-over-year by at the very least 24%, and by as high as 94%.

See both bar charts below.

Fiscal 2Q21 Rev. growth by major/geo segment.

Figure 2: Fiscal 2Q21 revenue growth by product and geographic segment

  • iPhone did very well, going up double digits in all geo segments and acting as a tailwind to margins. CEO Tim Cook said that the Pro and Pro Max part of the iPhone 12 portfolio performed best.
  • iPad's 79% revenue increase was the largest growth rate among all main segments this quarter. CFO Luca Maestri talked about lockdowns lasting longer in Europe, which has driven demand higher for tablets.
  • Mac's three past quarters have been the three best ever. Just as the iPad, Mac benefited from a bit of the stay-at-home tailwinds.
  • Wearables were up about 25%. Apple Watch mentioned again as an outperformer, and reported to have been up in every geographic segment.
  • Services had the same strong performance across all geographic segments and in "most" sub-categories. The CFO drew a line between the large, successful services (iCloud, Music, App Store, etc.) and the up-and-coming ones that continue to ramp up (Arcade, Fitness+, etc.)

#2 COVID-19 still a factor

Clearly, Apple benefited from the stay-at-home trends, a byproduct of the 2020 pandemic, pushing iPad, Mac, iPhone and Services sales higher. Also, the delayed timing of the iPhone 12 release served as somewhat of a tailwind. But, to be fair to Apple, the company's strong performance can not be credited only to these one-off factors.

Another point to highlight was the incomplete guidance provided. Apple was unable to say much about revenue expectations for fiscal third quarter, other than that the top line should grow by "strong double digits".

Despite lack of full visibility into the next quarter, Apple shares have not sold off. The stock will likely start the April 29 trading session well in the green. 

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(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting The Apple Maven)