Apple’s Q2 2023 Slightly Down on Exchange Rates and “Macroeconomic Conditions”

Originally published at: Apple’s Q2 2023 Slightly Down on Exchange Rates and “Macroeconomic Conditions” - TidBITS

The one-two punch from foreign exchange rates and “macroeconomic conditions” rocked Apple’s profits in the just-concluded quarter below last year’s results, but only by a little.

Yeah, I feel so bad that Apple only made 24 Billion in profits and disappointed analysts. Especially in Apple’s case, the fact that the market which is no predictor of anything but someone’s gut is a joke. If $24 billion is not enough, buy some other stock.

I was…surprised when I worked as seasonal help at an Apple Store two years ago that the only sales statistics that mattered were iPhone sales and Applecare Plus contracts. I know there is some difference in goals from store to store, but the focus on iPhones was intense where I worked and we were told this was a corporate directive. One of several ironies was the supply chain was broken and we couldn’t get phones, but it didn’t matter. Don’t all those Mac and iPad sales count? “No,” my Leader told me. “Just iPhones.” Even though we don’t have any? “Just iPhones.” That is Apple’s direction. I’m glad Macs are doing well, but expect Apple to continue evolving into a phone and services company.

Apple First to Capture 8 Spots in List for Global Top 10 Smartphones

Not only is iPhone very profitable itself, it is also a foot in the door for very profitable services sales. Music is just one example:

  • Apple Music made approximately $8.3 billion revenue in 2022
  • 88 million people subscribe to Apple Music as of June 2022
  • iOS was responsible for 67% of app consumer spending in 2022

Yeah, that 76% statistic (iPhone + Services revenue) that came out of our chart was telling. But it’s important to keep in mind that it’s never a zero-sum game. Development that goes into iOS or the iPhone very often spills over into other operating systems and hardware. Plus, Services succeed largely because they support an entire ecosystem, not just the iPhone platform.