Apple Rides High on Record Revenue and Services Surge Despite China Hurdle

As of last week, Apple Inc. (AAPL) experienced a slight decline of 0.67%, marking a two-day losing streak with a total drop of 1.40% over those days. Over the past week, however, the stock has increased by 5.93%, though year-to-date it has decreased by 5.76%, with a current market capitalization of approximately $3.548 trillion.

In the most recent quarterly report for the first quarter of the 2025 fiscal year, aligning with the 2024 calendar fourth quarter, Apple announced a record-breaking revenue of $124.3 billion, reflecting a 3.95% increase. Despite a notable 11.08% decline in revenue from Greater China, the company's overall performance was bolstered by a significant surge in its services sector, which saw a revenue increase of 13.9% year-over-year, reaching $26.34 billion, setting a new historic high for the company.

Apple CEO Tim Cook attributed the revenue decline in Greater China to changes in channel inventory, the lack of available Apple Intelligence in the Chinese market, and the recent nationwide subsidy policies introduced in China. He emphasized that excluding the impact of inventory adjustments, the revenue drop would have been less severe.

In other regions such as the Americas, Europe, Japan, and the Asia-Pacific, Apple posted revenue growth, underscoring the strength in its global market presence outside of China. The iPhone line, which remains Apple's biggest revenue contributor at 55.62% of total sales, recorded $69.14 billion in sales, slightly falling short of expectations.

Counterpoint Research noted that Apple maintained its leadership in terms of revenue in India, marking a notable achievement as the company entered the top five in shipment volumes in the fourth quarter of 2024 for the first time. Apple's focus on expanding its footprint in India reflects its strategy to tap into burgeoning markets to offset challenges elsewhere.

The quarterly performance of Apple's Mac and iPad lines showed significant year-over-year revenue growth of 15.6% and 15.2%, respectively, indicating a robust resurgence in these categories, in contrast to a slight decline in the wearables and accessories segment.

Looking forward, Tim Cook remained optimistic about Apple's future, expressing confidence in the potential for innovation within the iPhone line, fueled in part by the ongoing expansion of Apple Intelligence to include more languages. This expansion, along with new AI features, is anticipated to stimulate continued interest and upgrades among consumers.

In terms of shareholder returns, Apple announced a $0.25 per share cash dividend, reflecting its strong earnings and cash flow generation capabilities, further reinforcing its commitment to providing value to shareholders.