Apple closed the fourth quarter of 2024 with robust results, reporting $94.93 billion in revenue, a 6.1% increase compared to last year. However, the company experienced a significant dip in net profit, falling 35.8% to $14.7 billion compared to Q4 2023. The gross margin reached $39.7 billion, up 8.5% year-on-year, while operating income rose by 9.7%.
Despite the profit decline, Apple remains optimistic, focusing on its major holiday season for better returns.
iPhone and iPad Sales Boost Q4 Results
The iPhone, Apple’s leading product, contributed $43.8 billion in sales, growing by 5.5% year-on-year. This success was attributed to the late arrival of the iPhone 16 series. Although its impact on Q4 was minor due to a limited selling window, the device sets up for a strong Q1 performance. On the other hand, iPad sales surged 7.9%, reaching $6.95 billion, thanks to a full quarter’s sales from new models like the M4 iPad Pro and M2 iPad Air.
Services also played a key role, climbing 11.9% to $24.7 billion, underlining Apple’s ongoing success in digital services.
Q1 2025: Holiday Hopes and AI Integration
Looking ahead, analysts stress the importance of Q1 2025. The holiday quarter is Apple’s most lucrative period, and this year, the rollout of Apple Intelligence—an AI feature across devices—is expected to fuel sales. New products, such as the updated MacBook Pro and 24-inch iMac with M4 chips, promise a lucrative quarter.
Apple has not offered guidance for Q1 2025, but market analysts are keeping a close eye. Evercore ISI, for instance, praises the revenue growth but cautions about tempered future expectations.
Analyst Reactions: Divided Outlook on Apple’s Future
Financial experts provided mixed opinions. Morgan Stanley called Apple’s Q4 performance “something for both bulls and bears,” while Evercore ISI noted “modest upside.” Piper Sandler voiced concerns about iPhone demand, suggesting that growth could remain subdued unless Apple Intelligence drives more interest.
In contrast, TD Cowen remains optimistic, giving Apple a “buy” rating, highlighting stable revenues despite global challenges.
As Apple enters 2025, all eyes are on its ability to harness its recent product launches and holiday sales for maximum impact.
