Apple's Q1 2024 Earnings Call Takeaways

[MacRumors]

Apple today held its earnings call for the first fiscal quarter of 2024 (fourth calendar quarter of 2023), with Apple CEO Tim Cook and Apple CFO Luca Maestri sharing details on Apple's performance, recent product sales, services growth, and more.

We've highlighted the most interesting takeaways from the earnings call.

EU App Ecosystem Changes

Maestri and Cook were asked about possible economic results from the changes that are being made to the App Store in the European Union. Maestri said that the EU represents just seven percent of Apple's global App Store revenue, while Cook said that impact it is impossible to determine right now because Apple finds it difficult to predict what customers and developers will choose.

"We've really focused on privacy, security and usability," Cook said. "And we've we've tried our best to get as close it in the past in terms of things that people love about our ecosystem, but we're going to fall short of providing the maximum amount that we could supply because we need to comply with the with the regulation."

Vision Pro

Apple CFO Luca Maestri said that several big companies are planning Vision Pro apps for customers and employees, including Walmart, Nike, Vanguard, Stryker, Bloomberg, and SAP. "From everyday productivity to collaborative product design to immersive training, we cannot wait to see the amazing things our enterprise customers will create in the months and years to come," said Maestri.

Cook said that Apple is "incredibly excited about the enterprise opportunities" with Vision Pro. Walmart, for, example, has a "very cool" merchandising app. There are companies making collaboration and design apps, there are field service applications, apps for control center/command center work, and more. "Really all over the map," said Cook.

"We couldn't be more excited about where things are right now," Cook said. "This has been multiple years of efforts from so many people across Apple and really took a whole of company effort to bring it this far."

AI

Tim Cook said that Apple is spending a "tremendous" amount of time and effort on artificial intelligence, and that details on its AI work will be shared later this year.

In terms of generative AI which I would guess is your focus, we have a lot of work going on internally, as I've alluded to before. Our MO, if you will, has always been to do work and then talk about work and not to get out in front of ourselves. And so we're going to hold that to this as well. but we've got some things that we're incredibly excited about, that we'll be talking about later this year.

Services

Apple's Services category set an all-time revenue record at $23.1 billion, up from $20.7 billion in the year-ago quarter. Paid subscriptions grew double digits year-over-year.

Apple set all-time revenue records in advertising cloud services, and payment services and video, along with December quarter records in the App Store and AppleCare.

Wearables

The Wearables, Home and Accessories category saw a drop in revenue, coming in at $12 billion, down from $13.4 billion last year.

Mac and iPad Sales

Mac sales were about flat at $7.8 billion (compared to $7.7 billion last year), but iPad sales were way down as Apple released no new models in 2023. iPad revenue was $7 billion, down from $9.4 billion last year.

Active Devices

Apple now has more than 2.2 billion active devices worldwide, which includes iPhones, iPads, and Macs.

Article Link: Apple's Q1 2024 Earnings Call Takeaways

 

[mtnDewFTW]

Tim Cook commenting on development of gen AI is super rare. He would normally deflect, but this is a pretty clear indication things are in the works for WWDC, as it was rumored.

 

[grantishere]

Is Tim going to give the report earnings a branded name like everything else Apple?

 

[aj_niner]

Oct 18, 2023 it was reported that more than 1.4 billion monthly active devices running Windows 10 or Windows 11 in April 2022.

 

[Octavius8]

And basic Bluetooth is still broken after several months of iOS 17.x…. Tim is useless.

 

[Mrkevinfinnerty]

iPad is dead 💀

 

[chabig]

And basic Bluetooth is still broken after several months of iOS 17.x…. Tim is useless.

Please elaborate. What problem do you have? How do you expect Tim to personally fix it for you?

 

[gsurf123]

Please elaborate. What problem do you have? How do you expect Tim to personally fix it for you?

My wife’s Lexus refuses to have a static free connection. Worked fine until iOS 15 I think. I would blame her phone, but it works perfectly with every other Bluetooth device including her earbuds.

 

[Heindijs]

EU users only contribute 7% of App store revenue? That seems like a really low amount. Does that line up with the amount of apple devices here or are other parts of the world just filled with excessive spenders?

 

[till]

I really want someone to ask Tim (though not on an earnings call) to explain why, if the DMA is so terrible for security on iOS, why they've voluntarily chosen to keep Mac security even more terrible than that. You can install anything! Unsigned apps downloaded from the web, the horror! Can't blame the regulators for that, that's entirely Apple's decision.

It's such an annoying BS talking point. They're not gaining anything from pushing it, the EU isn't suddenly going to change its mind.

 

[contacos]

They are lucky that they have such a dedicated user base but isn’t it normally like all about growth growth growth these days? To show longevity

 

[Plutonius]

Tim Cook commenting on development of gen AI is super rare. He would normally deflect, but this is a pretty clear indication things are in the works for WWDC, as it was rumored.

I hope that Apple can do better than Siri.

 

[JapanApple]

Users since the late 1970s, with no intention of going to another brand. I am a happy shareholder as well. It will go up

 

[anthogag]

Apple is back, baby!

 

[jayducharme]

Walmart, for, example, has a "very cool" merchandising app.

Somehow I don't think the majority of Walmart shoppers are the ones who are going to drop $3500 on a Vision Pro.

 

[MilaM]

The number of active devices sound very impressive. I'd like to know the definition of it. I'm one customer who does not even spend that much on Apple gear (🙈), and I currently have six devices that I use regularly. That does not include two "obsolete" Macs that I occasionally turn on a couple of times per year.

 

[coachgq]

My wife’s Lexus refuses to have a static free connection. Worked fine until iOS 15 I think. I would blame her phone, but it works perfectly with every other Bluetooth device including her earbuds.

Sounds like a Lexus issue to me.

 

[funkright]

Somehow I don't think the majority of Walmart shoppers are the ones who are going to drop $3500 on a Vision Pro.

I somehow think the reference was to merchandising management (at the buyer category mgmt level), not shopping apps per se, but I could be wrong

 

[ajkoeltz]

I somehow think the reference was to merchandising management (at the buyer category mgmt level), not shopping apps per se, but I could be wrong

That's the way I took it as they were referencing apps on the Enterprise level, not consumer.

 

[CalMin]

Interesting about iPad sales - I can see why. I'm still rocking two 2018 iPad Pros which are still solid for the things I need them for. M1/M2 versions while more powerful are only slightly more capable but not in areas that are meaningful to me. It feels like iPadOS is mature and there's not really much can be done to improve the tablet experience unless it became a full blown version of MacOS.

Don't get me wrong - I need an iPad and will always have an iPad, but this is the longest I've ever gone without upgrading an Apple device for something newer in the same line. Cash is ready waiting to scratch the itch if they can create one!

 

[CarAnalogy]

Tim Cook commenting on development of gen AI is super rare. He would normally deflect, but this is a pretty clear indication things are in the works for WWDC, as it was rumored.

The fact that he said anything at all speaks volumes. This is the most he has ever said about an upcoming product. Usually he wouldn't even acknowledge its existence.

 

[Bawstun]

It’s time to revamp the entire iPad lineup. 3 sizes, maybe 4 including an “Air” version.

It’s just way too saturated and confusing. There are so many models with differences among them, it takes the consumer literally doing research to figure anything out. No one wants to shop like that.

 

[CarAnalogy]

Please elaborate. What problem do you have? How do you expect Tim to personally fix it for you?

He meant some guy named Tim down at the Apple Store. Wouldn't even come outside to look at his Lexus. Damnit, Tim!

 

[Hans300]

Very good earnings numbers. Congrats to Apple!

 

[Anony-mouse]

I really want someone to ask Tim (though not on an earnings call) to explain why, if the DMA is so terrible for security on iOS, why they've voluntarily chosen to keep Mac security even more terrible than that. You can install anything! Unsigned apps downloaded from the web, the horror! Can't blame the regulators for that, that's entirely Apple's decision.

macOS was designed during a time with a lot less cyberthreats compared to when iOS came out. In any case, it is not so easy to install unsigned apps downloaded off the web on macOS anymore. You have to consciously and deliberately invoke the appropriate steps in order to install random stuff on macOS today.