Apple forecast December-quarter gross margins of 45% to 46% and services revenue growth of 8% to 9%, below analyst expectations. Fiscal fourth-quarter revenue was $114.48 billion and earnings were $2.10 per share, both above estimates.
Apple forecast gross margin of 45% to 46% for the quarter ending in December, down from 47.9% in the fiscal fourth quarter, citing higher memory-chip costs. It projected services revenue growth of 8% to 9%, below analysts’ 10.7% expectation. Shares fell 4% during a conference call after executives outlined the outlook.
Fiscal fourth-quarter sales reached $114.48 billion, above the $113.39 billion analyst estimate, and profit was $2.10 per share, above the $1.99 estimate even excluding 5 cents per share from tariff refunds. iPhone sales were $57.58 billion, above the $56.54 billion estimate, while gross margin of 47.9% topped the 47.5% estimate.
CEO John Ternus said a very small percentage of iPhone Duo units had been returned for display issues and that Apple was replacing them. He said demand exceeded supply, with no timeline for when supply and demand would be in balance. Ternus also said higher memory costs were partly offset by inventory, lower costs on some non-memory components and price increases.
