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Apple’s shares surge after strong FQ2 results

Monday, May 06, 2024

Today’s headlines

What’s happening: Shares of Apple gained on Friday, after the company released results for its second quarter.

What happened: The iPhone maker reported stronger-than-expected sales and earnings for its latest quarter.

Apple also announced a record stock buyback program and an increase in its quarterly dividend.

How were the results: The Cupertino, California-based company reported a decline in revenues for the fiscal second quarter.

  • Revenues contracted to $90.75 billion, from $94.84 billion in the year-ago quarter, but topped the consensus estimates of $90.01 billion.
  • Non-GAAP earnings rose to $1.53 per share, surpassing Wall Street expectations of $1.50 per share.

Why it matters: Apple witnessed some weakness in iPhone sales in the quarter, which was somewhat offset by strength in the Services and Mac product segments. iPhone sales fell 10.46% year-over-year to $45.96 billion, while Services and Mac sales climbed 14.16% and 3.91%, respectively.

All geographies, excluding Europe, reported a year-over-year decline in sales. Revenues in North America fell 1.35% to $37.27 billion, while Europe sales rose 0.71% to $24.12 billion.

“Thanks to very high levels of customer satisfaction and loyalty, our active installed base of devices has reached a new all-time high across all products and all geographic segments, and our business performance drove a new EPS record for the March quarter,” CFO Luca Maestri said during the earnings call.

The company’s board declared a quarterly dividend of 25 cents per share in cash, representing a 4.17% gain from the dividend of 24 cents per share paid in the prior quarter. Apple’s board also authorised additional share repurchases worth $110 billion.

Management guided to revenue growth in “low-single digits” for the fiscal third quarter. They also projected Services and iPad sales to increase by double digits.

How shares responded: Apple’s shares rose 6% to close at $183.38 on Friday, following the release of quarterly results. The stock has gained around 9% over the past month.

What to watch: Investors await updates on upcoming product launches, with an iPad event scheduled on May 7. These launches are expected to boost the overall demand for the company’s hardware business.

The markets today

The USD/JPY forex pair will be in focus today ahead of some major economic releases

Context: The US dollar dipped to a three-week low versus the Japanese yen on Friday, as investors assessed US jobs report.

Details: Data released by the US showed jobs growth slowing more than projected in April, along with easing in annual wage growth. The data release increased speculations of the Federal Reserve slashing interest rates twice in 2024, exerting pressure on the US dollar.

US employers added 175,000 jobs in April, which came in below market estimates of a 243,000 gain. Wages rose 3.9% in the 12 months through April, short of projections of a 4.0% increase. The unemployment rate rose to 3.9% in the month, from 3.8% in March, but remained below the 4% mark for the 27th consecutive month.

Traders now expect the US central bank to cut interest rates twice this year by a total of 47 basis points, compared to speculations of 42 basis points before the jobs report.

The US dollar index, which measures the greenback’s performance versus a basket of major peers, lost 0.2% to reach 105.08 on Friday.

The USD/JPY forex pair fell below the 153 level on Friday. The Japanese currency had declined to a 34-year low of 160.245 last Monday.

What to watch: Investors await the release of services PMI and composite PMI from Japan on Tuesday. The au Jibun Bank flash services PMI is expected to rise to 54.6 in April, versus a final reading of 54.1 in the prior month, while the composite PMI is projected to improve to 52.6 in April, from 51.7 in the prior month.

Other Markets: European indices closed higher on Friday, with the FTSE 100, DAX 40, CAC 40 and STOXX Europe 600 Index up by 0.51%, 0.59%, 0.54% and 0.46%, respectively.

The news shaping the markets

The Russian military has reportedly hired hundreds of Cubans to fight in its ongoing war against Ukraine. The news sent the safe-haven US dollar index higher in forex trading this morning.


Australia’s job advertisements rose by 2.8% in April, after a 0.1% decline in the prior month, which lent support to the AUD/USD forex pair.


China’s Caixin General Composite PMI edged higher to 52.8 in April, from 52.7 in the previous month, which sent the CNY/USD pair higher in forex trading this morning.


Singapore’s S&P Global PMI fell to 52.6 in April, from 55.7 a month ago, exerting slight pressure on the SGD/USD forex pair.


Hong Kong’s S&P Global SAR PMI declined to 50.6 in April, from March’s three-month high of 50.9, sending the HKD/USD pair lower in forex trading this morning.

What else to watch today

Russia’s composite PMI and services PMI, Spain’s unemployment change, services PMI and composite PMI, South Africa’s S&P Global PMI, Italy’s services PMI and composite PMI, France’s services PMI and composite PMI, Germany’s services PMI, composite PMI and new passenger car registrations, Eurozone’s services PMI, composite PMI and industrial producer prices, Brazil’s gross debt to GDP, services PMI, composite PMI and government budget value and Central Bank of Brazil’s focus market readout, as well as Canada’s average hourly earnings.


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