Apple announced the financial results for its fiscal second quarter of 2016 this afternoon, and the numbers are pretty rough. While they fall within the company’s own guidance, iPhone sales are down 10 million units from the year-ago quarter, and revenue is down $7 billion.
We’ve just finished up the conference call, where Tim Cook and CFO Luca Maestri discussed Apple’s performance over the three-month period, and offered up some insights into its future. And as usual, we’ve rounded up the 15 most interesting points from the call below.
- Cook: “It was a challenging quarter for the company.”
- Apple now has $232.9 billion in cash and marketable securities.
- Apple expanding capital return program by four quarters and $50 billion. Total buyback will be $250 billion.
- Apple has made 15 acquisitions in the last 4 quarters, and is constantly on lookout
- Apple Music now has 13 million paying subscribers
- Services revenue (iTunes, etc.) was highest ever, up 20% to $6 billion
- Now more than 10 million contactless locations in Apple Pay countries, 2.5 million in U.S. alone.
- Cook: “iPhone SE demand exceeds supply, but we’re working hard to meet demand.”
- Upgrade rate for iPhone 6s has been higher than 5s cycle two years ago, but lower than 6 cycle.
- Customers are also incredibly loyal. 95% loyalty rate, highest for any smartphone.
- Added more switchers (from Android, etc.) in first half of 2016 than any other six month period
- Cook: “We’re really excited about the first year of Apple Watch, and it has an exciting future.”
- Other Products revenue up 30% thanks to Apple Watch.
- Customers very happy with Apple Watch, 94% customer satisfaction.
- Cook: “In June quarter, we expect best iPad unit comparison in over two years thanks to new iPad Pro.”
If you want to listen to today’s earnings call, a replay will be available here for a limited time.