Apple Shares Jump Over 4% In Pre-Market After Tim Cook Calls Q1 'Best Quarter Ever' For iPhone Maker

Shares of Apple Inc AAPL rose by 4.02% in premarket on Friday following better-than-expected first-quarter revenue and earnings per share. CEO Tim Cook described Q1 as their “best quarter ever”. However, iPhone and China sales fell below expectations for the given quarter.

What Happened: Apple stock closed 0.74% lower on Thursday after which the company reported its first-quarter earnings.

While its revenue reached $124.3 billion as compared to the $124.13 billion expected by Benzinga Pro, the adjusted EPS also surpassed expectations at $2.40 as compared to the estimates of $2.36 per share.

However, the iPhone sales slipped to $69.14 billion, versus $69.7 billion in the same quarter last year.

With a good Q1, the company beat eight consecutive quarters of expectations, according to Benzinga Pro.

The iPhone maker’s success was fueled by growth in its services sector and strong performance in international markets. Services revenue, which includes offerings like Apple Music and iCloud, climbed to $26.34 billion, up significantly from $23.12 billion last year.

Geographically, Apple saw robust sales across various regions. The Americas contributed $52.65 billion, while Europe generated $33.86 billion. Japan brought in $8.99 billion, and the rest of the Asia-Pacific region contributed $10.29 billion. Greater China sales were at $18.51 billion, but Wall Street expected $21.5 billion from China.

Product revenue totaled $97.96 billion, a slight increase from $96.46 billion the previous year. Mac sales rose to $8.99 billion from $7.78 billion, and iPad sales also increased to $8.09 billion from $7.02 billion. Sales of Wearables, Home and Accessories, however, saw a slight decline, reaching $11.75 billion compared to $11.95 billion last year.

Why It Matters: Despite fluctuations in specific product categories, Apple highlighted a significant milestone. Its active installed base of devices reached an all-time high across all product lines and geographic segments.

“Today Apple is reporting our best quarter ever, with revenue of $124.3 billion, up 4% from a year ago," said Cook, Apple's CEO. Cook also emphasized the company's focus on innovation, stating, "Through the power of Apple silicon, we're unlocking new possibilities for our users with Apple Intelligence, which makes apps and experiences even better and more personal. And we're excited that Apple Intelligence will be available in even more languages this April."

Price Action: Shares rose over 4% to $247.14, during the publication of this article, whereas the exchange-traded fund tracking Nasdaq 100, Invesco QQQ Trust, Series 1 QQQ rose 0.85% to $527.50.

Apple has gained 28.84% over the last year and 6.98% in the last six months.

The average price target among 30 analysts tracked by Benzinga is $246.79 with a ‘buy’ rating. The estimates range from $188 to $325 apiece. Recent ratings from Morgan Stanley, Evercore ISI Group, and BofA Securities suggest a $266.67 target, implying a potential upside of 8.45%.