Apple services revenue reached all time high in first quarter

Apple announced its financial results for the first quarter of 2024 on February 02, 2024. The company posted quarterly revenue of $119.6 billion or 2% higher than the same quarter of the prior year. Its EPS diluted was $2.18 or 16% up year on year.

Apart from iPhone sales, record revenue services drove Apple’s revenue growth in the first quarter of 2024 primarily. According to Apple CEO, Tim Cook, Apple’s installed base of active devices has grown higher than 2.2 billion, reaching an all-time high across all products and geographic segments. Apple also released its Vision Pro on the same day in the US.

Apple’s total net sales for the first quarter of 2024 was $119,575 million compared to $117,154 million in the same quarter of the prior year. While Apple’s product sales in the first quarter of 2024 remained flat, the company posted sales growth in the services category. Services revenue of the company grew by more than $2 billion compared to the first quarter of the previous year. Apple generated $23.1 billion from services in the first quarter of 2024. Last year, its services revenue in the first quarter was $20.8 billion. Apple’s product revenue in the first quarter of this year was $96.46 billion compared to $96.4 billion, a year ago.

Apple’s total cost of sales decreased in the first quarter of 2024 while its gross margin increased compared to the same quarter of the prior year. The company also experienced more than 11% growth in its quarterly net income. Apple spent $7.7 billion on research and development in the first quarter of 2024, or the same as the first quarter of 2023. 

Quarterly net income of the company reached $34 billion in Q1 2024 compared to $30 billion for the same quarter of last fiscal.

Apple’s EPS diluted grew to $2.18 in the first quarter of 2024 from $1.88 in the same quarter of 2023.

The company experienced sales growth across all geographic regions except Greater China where it experienced a YoY drop of above 11% in revenue. Last year, Apple had generated $23.9 billion from the Chinese market in the first quarter, which has dropped to $20.82 billion in the first quarter of 2024. Apple generated $50.4 billion from the Americas in the first quarter of 2024 compared to $49.3 billion last year.

Apple has experienced revenue growth primarily in the iPhone and services segments. Its Mac revenue increased only slightly while revenue from iPad and wearables, home and accessories segment declined. Apple’s iPhone revenue grew $3.9 billion YoY. In the first quarter of last year, Apple generated $65.8 billion from iPhone sales and this year its iPhone revenue in the first quarter grew to $69.7 billion. Mac revenue grew by $45 million YoY from $7,735 million in the first quarter of 2023 to $7,780 million in the first quarter of 2024. Its iPad revenue declined in the first quarter of this year to $7 billion which stood at $9.4 billion in the same quarter of the prior year. Revenue from the wearables, home and accessories segment that was $13.5 billion in the first quarter of 2023 declined to $11.95 billion in the first quarter of 2024.

Apple’s sales decline in China can be attributed to the resurgence of Huawei in the Chinese market. According to counterpoint research, Apple’s iPhone sales in China over the first six weeks of 2024 have declined by 24%. Smartphone sales have declined 7% overall in the Chinese market during this period. However, it was not just Apple, but Oppo and Vivo also experienced double digit declines in smartphone sales in the same period.

Apple Net Sales Q1 2024 Q1 2023 Change % Y/Y
Products $96,458 $96,388 –%
Services $23,117 $20,766 11%
Total Net Sales $119,575 $117,154 2%
Total Net Income $33,916 $29,998 13%

All sums in millions except percentages*