New iPhone brings strong profits to Apple

With the help of an old friend iPhone, Apple's profits have grown for the first time in a year.

Sales of Apple's flagship products have fallen sharply over the past year, but on Tuesday, Apple said that iPhone revenue had once again grown. The company said that customers have invested heavily in its latest models, and iPhone sales in the most recent quarter increased by 7.7% over the same period last year to nearly $ 56 billion.

This increase helped Apple's profit grow 11.4% to $ 22.3 billion. These numbers easily exceeded Wall Street expectations, which is welcome news for Apple investors. Over the past year, Apple investors have seen Apple's usually strong growth suddenly disappear.

Apple announced four consecutive quarters of shrinking profits before Tuesday, the longest since 2016.

In an interview, Luca Maestri, Apple's chief financial officer, said demand for Apple's latest iPhone (the iPhone 11 series released in September) exceeded expectations. He attributes strong sales to new features such as better cameras and longer battery life, as well as financing options to buy new phones and a $ 50 price cut for the cheapest model.

Wedbush Securities technical analyst Daniel Ives said demand for the new iPhone has been suppressed as many people wait to upgrade their old devices. "It's amazing how strong mobile phone sales are," he said. "More than the Bulls had hoped for."

Apple is also attracted by some of its new products.

Apple's service revenue, or sales from its App Store and subscription products, increased nearly 17% from last year to $ 12.7 billion. Sales of the so-called wearables unit, which includes the Apple Watch and AirPods wireless headphones, rose 37% to just over $ 10 billion.

Analyst Daniel Flax of investment company Neuberger Berman said the growth in services and wearables "provides that the company continues to transform itself."

Apple has also shown continuous improvement in China, which is the second largest market after the United States. A year ago, Apple had to be the first to report earnings because of news that its sales in China would be much lower than expected.