Apple stages sharpest rally in 9 months as execs cite iPhone, Mac demand in boosting guidance
Apple shares rallied sharply after the company reported better-than-expected revenue and earnings for its fiscal second quarter, driven by strong performance in services, Mac, and iPad sales despite slightly missing iPhone targets. Executives raised guidance, citing robust demand, while analysts upgraded their earnings forecasts, citing improved margin outlook. The company's services segment, benefiting from a large installed base of devices, continues to boost profitability with higher-margin offerings.
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"That does create some risk, but after last night's results, we feel much better about Apple's ability to manage margins" than previously expected, wrote analysts at Morgan Stanley, in a note to clients on Friday. "It's the single-greatest source of our estimates moving higher post-earnings."The analysts, who recommend buying the stock, lifted their earnings per share projection for the fiscal year to $8.89 from $8.63. Prior to the bullish guidance issued on the earnings call, Apple reported a revenue and earnings beat for the fiscal second quarter. Revenue climbed 17% to $111.18 billion from $95.4 billion a year earlier. Analysts were expecting sales of $109.66 billion, according to LSEG.
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