Shares of Apple rose after the tech giant beat estimates on revenue and earnings, driven by strong demand for iPhone 11’s.
Services revenue, Apple’s biggest growth driver, however, grew 17%, against estimates of 20%.
The stock rose 2.42% to $325.13 a share in postmarket trading Tuesday, after having risen 2.83% in regular trading hours.
Earnings per share came in at $4.99, beating Wall Street estimates of $4.54 and grew 19% year-over-year. Revenue was $91.18 billion, beating analysts estimates of $88.478 billion and grew 8.3%.
iPhone revenue was $55.9 billion, beating estimates of $51.4 billion and grew 7%. Analysts were expecting more revenue declines for the iPhone.
Services revenue — one of the key segments investors are looking to for long-term growth — came in at $12.7 billion, missing estimates of $13 billion. Wearables, home and accessories revenue was $10 billion, beating estimates of $9.85 billion.
Gross margin was 38.3%, beating estimates of 38%.
“We are thrilled to report Apple’s highest quarterly revenue ever, fueled by strong demand for our iPhone 11 and iPhone 11 Pro models,” said CEO Tim Cook in a statement.
The company guided for fiscal second quarter 2020 revenue of between $63 billion and $67 billion, better than analysts forecast of $62.4 billion. Gross margin was guided for been 38% and 39%, a strong reading.
The stock had rallied 27% in the three months leading up to earnings, as investors had grown optimistic not only on the services story, but a clear path toward returning to iPhone sales growth.
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