Did Apple's 'Red Circle' Tactic Lead to More Active Pay Users?

Muriel Hammond
May 3, 2018

Instead, the popularity of the iPhone X helped Apple to is best-ever second quarter, with revenues weighing in at $61.1 billion, up by 15 per cent on the same period past year, and well ahead of analysts' consensus expectations.

Apple declared that its board has initiated a share buyback program on Tuesday, May 1st that permits the company to repurchase $100.00 billion in outstanding shares. The comments come amid investor worries, fueled by negative press reports, that Apple's high-priced flagship model was not selling well. Cook said that despite recent trade tensions between the US and China, he's optimistic.

No company benefited more from the tax break on overseas cash than Apple, which had accumulated more than $250 billion outside the USA during the past decade, thanks to the enormous popularity of the iPhone and other products. Tim Cook, CEO of Apple, described the AirPods as a "runaway hit" with Apple fans.

It also doled out another $3.2 billion in dividends and will boost them by 16 percent going forward.

But now Apple is eyeing more products and service headed towards India.

These metrics also don't mention where the new users of Apple Pay come from: the service launched in several new markets previous year (it's now available in 21 markets), including Denmark and Finland.

It's also hard to quantify how much of the repatriated money is being funneled to shareholders.

"I'd hoped for more on the dividend side or maybe a strategic investment", said Hal Eddins, chief economist for Apple shareholder Capital Investment Counsel. Revenue stood at $61.14 billion finishing in-line with the $61.15 billion prediction that analysts had made. The firm noted that the implied iPhone units in the coming quarterly guidance was higher than investor expectations, and iPhone X was the number one selling phone in China.

The news is likely to squash speculation Apple could temper ever swell out iPhone prices.

Apple's quarterly results on Tuesday topped Wall Street forecasts, which dropped ahead of the report on growing concern over the iPhone.

Sales of 52.2 million iPhones against a Wall Street target of 52.3 million was a comfort and up from 50.7 million a year ago, according to data from Thomson Reuters I/B/E/S.

IPhone sales rose 2.9% to 52.2 million units, in line with analyst estimates of 52.3 million. That was followed by more recent reports to clients from Mirabaud Securities analyst Neil Campling, who as late as yesterday reiterated his earlier comment that the iPhone was dead. The company didn't provide a timeline for the repurchases. Netflix's so-called "contribution margin" for its streaming business - the metric the company uses to gauge margins on that segment - was 37 percent in 2017. The smartphone sector saw shipments fall 2% in the past year, according to Strategy Analytics, so the company must evolve beyond its reliance on a device that still accounts for more than 60% of revenue. There has been recurring speculation that Apple might try to buy Netflix, a deal that would probably cost at least $150 billion and would break the mould for a company that has shunned major acquisitions through its history.

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