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| Apple has revenue of $123.9 billion |
Apple announced financial results for the first quarter of fiscal year 2022 ending December 25, 2021. The company beat analyst estimates in every product category except for the iPad, with overall sales up 11% annually.
CEO Tim Cook said challenges in the company's supply chain are improving.
The company's revenue was $123.9 billion and grew at an annual rate of 11%. iPhone revenue reached $71.63 billion, an increase of 9% year over year.
Services revenue was $19.52 billion, an increase of 24% year over year. Other product sales were $14.7 billion, an increase of 13% year-over-year.
Mac revenue was $10.85 billion, an increase of 25% annually. iPad sales reached $7.25 billion, down 14% year over year.
Apple has not provided an official estimate for its guidance for the current quarter. The company also did not provide any estimates since the start of the coronavirus pandemic, citing the uncertainty.
The company's CEO, Tim Cook, made forward-looking statements in an interview with CNBC. "We expect strong year-over-year revenue growth in the third quarter," Cook said. We expect supply shortages to be lower in the March quarter than in the December quarter.
Revenue was another strong result for the company in the largest quarter of the year, which includes holiday sales. Despite management warnings in October that supply issues could hurt the company's sales, every one of its product lines, with the exception of the iPad, grew year on year.
Cook said the company's supply problems were improving. He also said that the December quarter was worse than the company's September quarter in terms of supply issues, but the March quarter is expected to be better.
Apple tops the rankings in all product categories except iPad
"Our biggest problem is the supply of chips," Cook added. The main chip is the powerful processor at the heart of the phone, while the traditional node chip is another less complex part that performs functions such as the display or power management.
Apple introduced new iPhone models in September, and this quarter marked the first full quarter of iPhone 13 sales, giving investors insight into how competitive the devices are in the market.
Revenue grew 9% annually to $71.63 billion, but at a slower pace than the company's total turnover.
Additionally, Cook said Apple is proud to report a 9% increase in iPhone sales. Although supply was limited this quarter.
Services like iCloud, Apple Music, search licenses, and App Store fees continued to grow strongly. It grew 25% annually to $19.52 billion.
Services are the company's most profitable area of business. His rise boosted the company's gross profit margin more than expected.
Other Apple product categories, including the Apple Watch and AirPods, grew 13% annually. The quarter included sales of the latest Series 7 watches, which feature larger screens, and new AirPods.
The Mac saw the strongest growth of any Apple line, up 25% year over year to $10.85 billion.
In October, Apple introduced new MacBook Pro models starting at $1,999 that feature new Apple chips instead of Intel chips.
Compared to last year, iPad sales are down. But that's likely because Apple can't make enough iPads and prioritize other devices. Cook attributed the iPad's performance to a serious supply shortage.