Bullish Options Prices Pop as Apple Stock Soars

Isaac Cain
May 3, 2018

iPhone sales grew by 3 percent to 52.2 million during the second quarter of 2018, but revenue jumped by 14 per cent thanks the iPhone X, which is the most expensive smartphone the company has ever produced.

"Growth in the near-term will come from higher iPhone X pricing, a lower-cost iPhone SE update, selling more services like Pay to its premium subscribers, and increasing output of its surprisingly popular Watch portfolio", said Neil Mawston, an analyst at Strategy Analytics.

While sales of Apple's iPhone did not deliver a big upside surprise, nor did they fall through the floor, as some anxious they might.

Cook is under no illusion that the iPhone X didn't sell as well as Apple's own initial expectations, however he did reveal during the earnings call that customers chose the iPhone X over other models "each and every week" during the quarter. Analysts expected 56 cents and $669 million.

This growth was largely credited to the iPhone, with Apple flogging 52.2 million smartphones during the three-month period, up three per cent on previous year. As a result, analysts had expected Apple to repatriate most of its $252 billion in cash overseas. For example, the average selling price for iPhones was $728, while Wall Street expected that figure to be $742 - nevertheless ASPs are still up 10 per cent on a year ago.

It attributes worldwide sales for its revenue growth with that segment accounting for 65 per cent of the quarter's total revenue figure. Shares remained strong in pre-market trading yesterday and were up 3pc at 4.42am in NY.

San Francisco: Apple Inc.'s results confirmed that, while the days of double-digit smartphone industry growth are over, chief executive officer Tim Cook has a plan to withstand the slowdown.

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Baystate Wealth Management LLC lifted its stake in shares of Apple (NASDAQ:AAPL) by 2.4% during the 4th quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission.

As for disappointing iPhone X sales and trouble in China? Apple said consumers had paid for more than 270 million subscriptions for its services or ones sold via its App Store, up from roughly 170 million a year earlier.

With a mountain of overseas cash suddenly freed up by the tax overhaul, Apple bought back $23.5bn of its own stock in the March quarter, a record amount for any United States company, according to S&P Dow Jones Indices, and it added $100bn to its target for future repurchases. Apple also will spend $100 billion more buying back its stock, a move that will enrich shareholders by helping to drive up the company's stock price.

Apple also markets related accessories, software, networking solutions, services, and third-party applications and digital content.

During an analyst call on Tuesday, Apple CEO Tim Cook acknowledged the company's low marketshare in India, which stood around 2-3 per cent of overall mobile sales in India. This, combined with an attached aspirational value with the Apple brand in India, has helped MacBook sales to grow.

On China, Cook said he believes it is a phenomenal country with lots of opportunity both from a market and an app developer point of view.

But investors have had concerns around Apple because of brewing trade tensions with China.

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