Shulou(Shulou.com)11/24 Report--

According to news in the morning of October 28, Beijing time, Apple today released the company's fourth-quarter results for fiscal 2022. Apple's revenue in Greater China in the fourth quarter was $15.47 billion, up 6 per cent from $14.563 billion a year earlier. Revenue in Europe was $22.795 billion, compared with $20.794 billion in the same period last year; revenue in Japan was $5.7 billion, compared with $5.991 billion in the same period last year; and revenue in the rest of the Asia-Pacific region was $6.373 billion, compared with $5.192 billion in the same period last year. Apple's fourth-quarter net income was $90.146 billion, up 8% from $83.36 billion a year earlier, net profit was $20.721 billion, up 1% from $20.551 billion a year earlier, and diluted earnings per share was $1.29, up 4% from $1.24 a year earlier, according to the report.

After the announcement, Apple management held a conference call with CEO Tim Cook, chief financial officer Luca Maestri and Tejas Gala, senior director of investor relations, attending and answering analysts' questions. The following is the main content of the question and answer session of the analyst in this conference call:

Shannon Cross, an analyst at Credit Suisse: could you ask management to talk about iPhone intergenerational products? On the positive side, the company made the decision to raise prices and raised the average selling price; from a negative point of view, investors are worried about the impact of price increases on demand and growth pressure. May I ask the management to talk about the current demand for iPhone products? Considering the current objective uncertainty, what will be the changing trend of demand in the future?

Tim Cook: iPhone revenue grew by 10% to $42.6 billion in the fourth quarter. Consumer demand is strong, higher than we expected, and this growth is based on 39% growth in fiscal year 2021 from a relatively large base. We are very satisfied with the performance of the new products, including the iPhone 14 Pro,iPhone 14 Pro Max, which have not been released for a long time, and from the beginning, 14 Pro and 14 Pro Max are in short supply, and this situation continues, so we have been making continuous efforts to meet the purchase needs of consumers until these needs are fully met. It is difficult for us to describe the exact proportion of sales of specific products, and we will continue to follow up the data in this regard.

We are very satisfied with the overall strength of the iPhone product line: there are three iPhone products among the top four best-selling models in the US and UK, three best-selling models in Chinese cities, the top six in Australia, four iPhone products in the top five best-selling models in Germany, and two best-selling models in Japan. Overall consumer satisfaction with iPhone products reached 98%. We are very satisfied with the performance in the fourth quarter. The current sales situation indicates that the supply of 14 Pro and 14 Pro Max will continue to fall short of demand, and we are also working to solve this problem.

Shannon Cross: could you ask Luca to talk about the changes in gross profit margin? I think the situation of 10 basis points affected by exchange rate in the coming fiscal quarter is unprecedented. Can you tell us something about this and what other positive factors are there to support gross profit margin? What other factors need to be considered to calculate the change of the company's gross margin in the future?

Luca Maastri: let me first talk about the gross margin in the fourth quarter and then introduce the situation in the first quarter. The gross profit margin of 42.3% in the fourth quarter hit a record high for the quarter, which was achieved after you mentioned a number of adverse factors, including an exchange rate of 70 basis points from a month earlier, a year-on-year impact of 170 basis points, and a depreciation of currencies against the dollar.

According to our outlook, the gross profit margin for the first quarter will be 42.5% and 43.5%, taking into account the negative exchange rate impact of 330 basis points compared with the same period last year and 120 basis points compared with the previous year. It is clear that the strong dollar has created difficulties for us in many areas, pricing in emerging markets is also very difficult, and local revenues translated into dollars are also affected.

On the positive side, the trend of commodities is very good for us and can offset the negative factors in the exchange rate, which is also reflected in our outlook. of course, a higher exchange rate will also have an inflationary impact, but we got good results in the end.

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