[Financial Summary] Apple announced the largest stock buyback ever for the January-March fiscal year, which exceeded expectations, and rose 7% outside of hours

Chief Executive Officer Tim Cook (CEO) said at the earnings conference that there is a possibility that total revenue for the fiscal year ending June will show an increase rate in the first half of the single-digit range, and double-digit increases are expected in both service and iPad revenue, and since iPhone sales are growing in the mainland China market,The long-term outlook for the Chinese business remains brightI made that clear. Also, it was once again emphasized that the company is investing a large amount of money in generative artificial intelligence (AI).

Service revenue recorded a record high for 5 consecutive quarters, and iPhone sales fell 10% compared to the previous year
By business, it accounts for 60% of Apple's total salesiPhone sales were 45.96 billion dollars in the second quarter, down 10.5% from the same period last yearAs a result, although it did not reach the year-on-year increase for 3 consecutive quarters, it slightly exceeded market expectations of 45.76 billion dollars.

Some analysts said this may indicate sluggish demand for the iPhone 15 series, which was launched in September last year.

It has the highest profit margin and accounts for 20% of total revenueService revenue was 23.87 billion dollars, up 14.2% from the same period last yearAs a result, it exceeded market expectations of 23.28 billion dollars, and hit a record high for 5 consecutive quarters.

Also, this shows a growth rate of service revenue in the single-digit range for 4 consecutive quarters until the 3rd quarter of 2023, and shows a high double-digit growth rate for 3 consecutive quarters from the 3rd quarter of 2023 to the present. The companyService revenue will grow in the double-digit range for the next 2 quartersIt is anticipated that it will be maintained.

Of the other hardware that accounts for the remaining 20% of Apple's total revenueiPad revenue was 5.56 billion dollars, down 16.7% from the same period last yearThis is a decrease from the 5.91 billion dollars expected by the market.

Sales in Greater China exceeded expectations, and Cook focused on China's long-term outlook
By region, sales in the Greater China region, which accounts for about 20% of Apple's sales, were in the second quarter16.37 billion dollars, down 8.1% from the same period last yearAs a result, Wall Street fell 11% from the same period last yearExceed expectations of 15.87 billion dollarsThere were also many pessimistic predictions of a sharp decline of 28% compared to the same period last year.

The Greater China region is the third largest market after North America and Europe, and as a core business boasting far higher sales volume than any other hardware product, the good performance of iPhones in the Greater China region in particular is attracting attention.

What should I pay attention to?
Apple has been hit one after another this year. Due to prolonged user replacement cycles and local competition promotion measures, iPhone sales in China were sluggish, lost the position of the best-selling smartphone manufacturer in China, and handed over the top position in the global smartphone market to Samsung. The company abandoned its 10-year electric vehicle project in February this year, and is also facing increased surveillance and penalties under the Antimonopoly Act by Western regulators.

AppleIt lags behind competitors in the AI fieldThere is no shortage of investors and analysts who think that. People want to know “when and when” Apple's latest earnings report will fully invest in AI technology.

Chief Executive Officer Tim Cook (CEO) appealed that they are working on AI innovation many times this year to reassure shareholders, but Apple has not yet announced that it will integrate generative AI into its main products and services, and it has not achieved “great success” in popular fields such as chatbots.

Also, there is an analysis that suggests the possibility that Apple will announce details about the acquisition of the Canadian AI startup Darwin AI that was claimed by the media in March. Also,Apple's Annual Developers Conference (Worldwide Developers Conference) will be held from 6/10 to 14Since it will be done, the market consensus is that major AI developments will be announced.

Additionally, analysts are paying attention to growth indicators in the traditional sense, such as the number of iPhones sold in the main business, the status of service businesses, and capital returns.

How do you view Wall Street?
Apple is in negotiations with OpenAI and Google to integrate the generative AI function into the next generation model iPhone 16 to be released this fall, but there are reports that no agreement has yet been reached. AnalystsAI will lead to growth in acceleration and revitalization of the iPhone replacement cycleIt emphasizes that there is a possibility.

According to Goldman Sachs, investors are fully aware of the risks in Apple stock, and the focus is shifting from business results to growth catalysts for the second half of the year, including new product announcements such as iPhone 16, iPad, and Mac.Apple management's comments on generative AI are the absolute focusThis will have an impact on stock price movements.

Bank of America says that there is a possibility that Apple will benefit from the iPhone upgrade cycle accelerated by artificial intelligence next year, and it will not lose sight of the “weak demand environment.”“2024 Top Picked Stocks” with 36% increase in stock pricesIt is predicted that it will be.