"Revenue in Greater China fell 6.5%, the only region to decline."

Apple (AAPL.US) announced its financial results for fiscal Q3 2024 today. The report showed total net revenue of $85.777 billion, up 5% YoY, and net profit of $21.448 billion, up 8% YoY. Apple's net revenue from products in Q3 was $61.564 billion, up from $60.584 billion YoY; net revenue from services was $24.213 billion, up from $21.213 billion YoY.

Gross margin was $39.678 billion, up from $36.413 billion YoY, with a gross margin of 46.3% in Q3.

By product, iPhone revenue decreased slightly by 1% to $39.3 billion, Mac revenue increased by 2% to $7 billion, and Home, Accessories, and Wearables revenue decreased by 2% to $8.1 billion. iPad revenue increased significantly by 24% YoY to $7.2 billion, driven by the launch of iPad Pro (M4) and iPad Air (M2).

Regionally, the Americas segment generated revenue of $37.678 billion, up from $35.383 billion YoY; Europe segment revenue was $21.884 billion, up from $20.205 billion YoY; Greater China segment revenue was $14.728 billion, down 6.5% YoY from $15.758 billion, the only region to experience a decline.

Apple CFO Luca Maestri stated that Q4 revenue growth is expected to be around the 5% level seen in Q3.

During the analyst call following the earnings release, Apple CEO Tim Cook noted that Apple reported March quarter revenue of $90.8 billion, including record service revenue. Some Apple Intelligence features will roll out throughout the year, with Siri expected to integrate ChatGPT functionality by year-end. Apple is also increasing investment in AI and machine learning, planning to increase spending annually. In June, Apple showcased new AI features at WWDC, and released the first version of Apple Intelligence in late July. However, this technology will be used on iPhones, iPads, and Macs and is expected to be available to consumers in October.

Cook stated that Apple plans to introduce Apple Intelligence to US English users this fall, followed by continued rollouts next year with more features and languages.

Cook expressed excitement about the "value proposition" Apple Intelligence will offer to users, though upgrade rates may be difficult to predict at this time.

Apple Intelligence will run on iPhone 15 and newer devices, potentially driving upgrades. Cook noted that Apple's installed base has reached an all-time high, which may fuel an AI-driven upgrade cycle. Apple expects to release iPhone 16 with iOS 18 in September, followed by AI features. Service revenue grew at a double-digit rate.

Regarding the decline in Greater China, Cook noted signs of improvement compared to the first half of FY24, suggesting recent pricing discounts may be working. He also stated that iPhone 15 sales in Greater China have outpaced iPhone 14 sales since launch, a positive indicator ahead of the upcoming iPhone 16. Cook added, "AI is another reason for people to buy a new iPhone, and we remain confident in the long-term opportunity in China."

This article was originally written by the public account Caijingtuya (ID: caijingtuya). For reprints, please contact Tuya Jun.