Traders breathed a sigh of relief as Apple reported strong earnings after the close, putting a spark back into the Nasdaq. The Nasdaq had lost over 4% in 3 straight sessions following disappointing numbers from Facebook and Twitter which had weighed on demand for the broader sectors.
Apple reported a 17% increase in earnings at $53.3 billion for its fiscal third quarter, ahead of expectations. Profits jumped 32% to $11.5 billion. Whilst iPhone unit sales increased by just 1% to 41.3 million, the higher cost of the iPhone X increased the average selling price across the range lifting revenue from the iPhone 20% year on year. Apple’s Services and Wearables also beat expectations whilst forward guidance was also ahead of expectations.
London Capital Group said: “What was there not to like about these numbers? This was the news that the markets had been hoping for; there had been concerns going into this release that the iPhone X numbers just weren’t going to stack up, but that wasn’t the case and Apple has managed to pull it out of the bag again, proving why it should be the first trillion-dollar company. The final 7% lift in the share price required to hit that trillion-dollar level shouldn’t be so tough achieve after a set of figures like that.”