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Apple's stock rises on record $110B buyback plan as earnings beat expectations - SiliconANGLE

May 03, 2024 - siliconangle.com
Apple Inc. has seen a rise in its stock by more than 7% after reporting earnings and revenue for its fiscal second quarter that exceeded expectations. The company's board of directors has authorized a record $110 billion in share repurchases, a 22% increase from last year's $90 billion authorization. Despite a 10% drop in iPhone sales from a year earlier, Apple's second-quarter earnings before certain costs came to $1.53 per share, surpassing Wall Street's target of $1.50 per share. Revenue fell 4% from a year earlier, to $90.75 billion, slightly above the analyst target of $90 billion.

Apple CEO Tim Cook attributed the company's revenue decline to a difficult comparison to the year-ago period, which included $5 billion in delayed iPhone 14 sales due to COVID-19 supply chain issues. The company declined to provide formal guidance for the upcoming quarter, but Cook expects sales to grow in the "low single-digits." Apple's finance chief Luca Maestri anticipates a double-digit year-over-year increase in iPad sales and growth in services revenue in the current quarter. Despite facing regulatory pressures and competition from rivals, Apple is investing heavily in generative AI, with Cook revealing that the company has spent over $100 billion on AI research and development in the past five years.

Key takeaways:

  • Apple Inc.'s stock rose by over 7% after it announced a record $110 billion stock buyback plan and reported earnings and revenue for its fiscal second quarter that exceeded expectations.
  • The company's net profit for the quarter was $23.63 billion, a slight decrease from the $24.16 billion profit recorded in the same period a year earlier.
  • Apple's iPhone sales fell by almost 10% from the year-ago period to $45.96 billion, indicating weak demand for the current generation of smartphones.
  • Despite facing challenges such as regulatory pressures and competition from rivals, Apple is making significant investments in generative AI, with CEO Tim Cook revealing that the company has spent over $100 billion on AI research and development in the past five years.
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