Key takeaways from Apple's Q3 call include tariff talk

Jul. 31, 2018 6:07 PM ETApple Inc. (AAPL)AAPLBy: Brandy Betz, SA News Editor43 Comments
  • Tim Cook starts the Apple (NASDAQ:AAPL) earnings call by reviewing the 17% Y/Y revenue growth, the strongest growth rate in the past 11 quarters.
  • Revenue for iPhones grew 20% on the year with the active install base up double digits. The iPhone X was the most popular as the ASP boost suggested. 
  • Cook says “we feel great about Services momentum” and reiterates the target of doubling annual Services revenue to $50B by 2020. Paid subscriptions from Apple and third parties hit 300M with revenue from subscription accounts a “significant and increasing” part of Services.   
  • Apple Music grew 50% Y/Y.
  • Wearables revenue hits $10B over the last four quarters.
  • CFO Luca Maestri reiterates that Apple grew in each of its top 15 markets with China up 19%. IPhone ASP was $724, up 20% Y/Y. 
  • Mac sales impacted by MacBook Pro refresh in Q4 instead of Q3.
  • Apple now has $243.7B in cash plus marketable securities with a net cash position of $129.1B. Maestri reiterates the plan to reach net cash neutral over time. 
  • China tariffs: During the Q&A, Cook discusses performance in China and the potential impact of tariffs. Cook notes that no Apple products were affected by the tariffs so far, but the company is evaluating the fourth tariff for $200B in goods and will share their views with the Trump administration. 
  • Apple shares are now up 3.6% to $197.10 with the company inching closer to that coveted $1T market cap.  
  • Previously: Apple +2.4% on Q3 beats with Services at all-time high (July 31)

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