Apple’s Services Sector Achieves Record Revenue Growth in Q3 2024

Apple has officially revealed its financial performance for the fourth quarter that concluded on September 28, 2024. The tech giant achieved an impressive record in its September quarter revenue, totaling $94.9 billion, which represents a 6% increase compared to the same period last year. Additionally, the diluted earnings per share stood at $1.64. This 6% growth marks Apple’s highest revenue increase in a two-year span. However, the company’s net income fell to $14.74 billion from $22.96 billion in Q4 2023, primarily due to a one-time tax-related charge of $10.2 billion incurred in Europe.

Breaking it down by segments, Apple’s iPhone sales surged by 6% year on year, generating $46.22 billion. The Mac segment saw a modest growth of 2%, with revenues reaching $7.74 billion. Furthermore, the iPad’s revenue climbed by 8% year over year to $6.95 billion. In contrast, the Wearables, Home, and Accessories category experienced a 3% decline, totaling $9.04 billion. Meanwhile, Apple’s Services sector, which encompasses offerings like the App Store, Apple TV+, and Apple Music, witnessed a noteworthy 12% growth in revenue, hitting a record of $24.97 billion. This impressive revenue marks a significant milestone, allowing the Services division to achieve a projected annual revenue run rate of $100 billion.

Notably, the revenue from Apple’s Services also accounts for the compensation paid by Google for being the default search engine across Apple’s devices, including the iPhone, iPad, and Mac. Due to ongoing legal challenges globally, there is a possibility that Google may need to halt these payments, which could drastically affect the revenue generated by Apple’s Services moving forward.

Tim Cook, the CEO of Apple, commented:

“Today, we are excited to share that Apple has reached a new revenue milestone of $94.9 billion for the September quarter, reflecting a growth of 6% year over year. In this quarter, we proudly introduced some of our finest products, featuring the all-new iPhone 16 range, Apple Watch Series 10, and AirPods 4, alongside innovative capabilities for hearing health and sleep apnea detection. Moreover, we unveiled our first set of features for Apple Intelligence, establishing a new benchmark in AI privacy and enhancing our product offerings as we approach the holiday season.”

Luca Maestri, Apple’s CFO, stated:

“Our outstanding financial results for the September quarter led to nearly $27 billion in operating cash flow. This enabled us to return over $29 billion to our shareholders. We are thrilled to report that our active installed base of devices has reached an unprecedented high across all product categories and regions, driven by exceptional customer satisfaction and loyalty.”

Additionally, Apple has declared a cash dividend of $0.25 per share, set to be distributed on November 14, 2024, to shareholders who are on record as of November 11, 2024.

Despite Apple’s remarkable revenue for the September quarter, the stagnation in year-over-year revenue from Greater China poses a significant challenge, as the Chinese market plays a pivotal role in Apple’s overall business strategy.

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