Apple Q3 2016 financial results | Apple earnings report: iPhone and Mac sales fall, overall revenue down, but Tim Cook talks up ‘encouraging signs’

Apple announced its financial results for the third quarter of fiscal year 2016 (the three months ended 25 June 2016) on Tuesday 26 July. Here, you’ll find out how many iPhones, iPads, Macs and Watches Apple sold during the past few months, how to listen again to Apple’s earnings call, and what the numbers mean – for you, for Apple’s product portfolio, and for Apple’s corporate health

Apple earnings report Q3 2016: Summary

For Q3 2016, the quarter ended June 2016, Apple reports:

  • Quarterly revenue of $42.4 billion, compared to revenue of $49.6 billion in the equivalent quarter a year ago.
  • Quarterly net income (profit) of $7.8 billion, or $1.42 per diluted share, compared to profit of $10.7 billion, or $1.85 per diluted share a year ago
  • Gross margin of 38 percent, compared to 39.7 percent a year ago
  • International sales accounted for 63 percent of the quarter’s revenue.
  • Apple’s board of directors has declared a cash dividend of $.57 per share of common stock. The dividend is payable on 11 August.

Not brilliant numbers, in other words, even though (as we’ll see in the next section) Apple predicted this a while ago. And Tim Cook said the results were “way better than we expected from so many different points of view”.

Cook went on to argue that there were “encouraging signs” and offered some explanations for the dip in revenues overall and in many key product areas, including the economic slowdown in China, a key growth market for Apple.

Apple earnings report Q3 2016: Podcast discussion

The UK Tech Weekly Podcast team discuss Apple’s latest financial results – among other things – in their 25th episode, embedded below. The Apple earnings section starts at the 26-minute mark.

The UK Tech Weekly Podcast comes out every Friday. Follow them on Twitter for links to new episodes.

Apple earnings report Q3 2016: How does this compare with Apple’s predictions?

It’s about what was expected. While posting Apple’s Q2 results back in April, Tim Cook offered the following guidance for Q3:

  • Revenue between $41 billion and $43 billion
  • Gross margin between 37.5 percent and 38 percent
  • Operating expenses between $6 billion and $6.1 billion
  • Other income (expense) of $300 million
  • Tax rate of 25.5 percent

In other words, as Cook pointed out in this quarter’s earnings call, Apple performed near the top of its expectations.

Apple earnings report Q3 2016: How many iPhones did Apple sell?

Apple sold 40.4 million iPhone units in Q3, generating revenue of $24bn. That compares to 47.5 million units in Q3 last year for a revenue of $31.4bn: the iPhone’s performance is down 14.9 percent in terms of unit sales and down 23.6 percent in terms of revenue.

Apple financial results: How many iPhones did Apple sell?

The iPhone is by far the most important and valuable product in Apple’s portfolio, and it’s worrying for Apple shareholders that the meteoric rise in iPhone sales appears to have peaked. Particularly worrying since these lower numbers take into account the launch of a new iPhone (the iPhone SE), while Q3 2015 did not.

But Tim Cook was keen to emphasise that the iPhone SE is doing well, and that customers who are new to the iPhone ecosystem account for a very high proportion of buyers: Apple has added millions of first-time smartphone buyers to its ecosystem, Cook stated. “Switchers accounted for the highest percentage of quarterly iPhone buyers we’ve ever measured,” he said.

Cook added that the active iPhone install base “is up, double digits, year over year”.

Apple earnings report Q3 2016: How many iPads did Apple sell?

iPads sales have looked stagnant in recent years, but Q3 was a little brighter for Apple’s tablet division. Cook called it “our best iPad compare in 10 quarters”.

Apple sold 10 million iPad units in Q3. That’s a drop of 9 percent compared to Q3 2015 – when Apple shifted 10.9 million iPads – but because of the higher unit price of the new iPad Pro, Apple actually made more money this time round. iPad revenue in Q3 was $4.9bn, up 7.4 percent on the $4.5bn made by the iPad department a year ago.

Cook said that roughly half of iPad Pro purchasers are buying them for work, which bodes well for its future as a business device and laptop replacement.

Apple earnings report Q3 2016: How many Macs did Apple sell?

Apple sold 4.3 million Macs in Q3, generating revenue of $5.2bn. That compares unfavourably to 4.8 million units in Q3 last year for a revenue of $6bn.

Apple financial results: How many Macs did Apple sell?

Apple earnings report Q3 2016: How many Apple Watches did Apple sell?

We don’t know for sure, since Apple continues to fold Apple Watch sales into its Other Products category, which we report on in a later section. (Of course, this does tell us that the absolute maximum revenue Apple can have made from the Apple Watch this quarter is a pretty minor $2.2bn, and that the true figure is presumably considerably lower than this.)

According to research from IDC, Apple sold 1.6 million units of the Apple Watch in Q2 2016, which corresponds to Apple’s fiscal Q3. That would generate revenue of at least $478m, based on the cheapest available model.

Tim Cook put a positive gloss on all this by pointing out that “Apple Watch continues to be the best-selling smartwatch in the world”, but that isn’t saying much right now. The same piece of IDC research cited above suggests the smartwatch market is in a bit of a slump, with shipments down 32 percent year on year.

Apple earnings report Q3 2016: Services

Apple’s Services division, which includes iTunes and the App Store, Apple Pay, and the AppleCare warranty and repairs division, continues to perform well. Services revenue for Q3 2016 was $6bn, up from $5bn a year ago. This is down to a 37 percent revenue jump from the App Store and “strong increases” in Music, iCloud and AppleCare revenue.

Cook said that for the past 12 months, services revenue is up almost $4bn year on year to $23.1bn.

Services earnings pale in comparison with the iPhone, admittedly, but this is still an excellent showing from Apple’s up-and-coming division. Tim Cook boasted that the company expects Services to be the size of a Fortune 100 company next year.

Apple earnings report Q3 2016: Other Products

Apple reported Q3 revenue of $2.2bn for Other Products (which includes the Apple Watch and Apple TV, as well as iPods, mice and keyboards, routers, accessories and the like). That’s a drop of 16 percent compared to Q3 2015, which saw Other Products revenue of $2.6bn.

 

[Source: Macworld]

Fresh Paint Windows 10 Preview lands in the Store but you can’t download it yet

For the artists among us, there’s a new app out on the Windows Store that might just help you unleash your inner creative: A preview version of Fresh Paint, the Windows 10 app that’s been around for a while now. While you should already have Fresh Paint installed by default, this new preview version is something else entirely. We don’t know precisely what the purpose of this app is, and it doesn’t help that we currently have no way of getting it.

The preview version of Fresh Paint, while having a listing up on the Windows Store, can’t be downloaded just yet. On top of this, its description is entirely barren, only giving out the basic two sentence description of the app: “The delightfully realistic painting application for you, your friends and family. It’s time to set your creativity free!”

This listing on the Windows 10 Store is, at the time of writing, sort of an anomaly. If it ever becomes something that we can download, however, it’s fair to assume it could have a few extra features that Fresh Paint users would want to get their hands on. For those curious, check out the app listing via the download link below. We’ll let you know once the app becomes available for download.

 

[Source:- Winbeta]

iPad Pro 9.7in review: Apple’s slick, superfast tablet could be another nail in the coffin of laptop culture… but it’s not perfect

iPad Pro 9.7in review

Welcome to Macworld’s iPad Pro 9.7in review for the UK. If you’d prefer a larger screen, read our iPad Pro 12.9in review.

Apple unveiled a new mid-size iPad at its ‘Let us loop you in’ March press event, as was widely expected, but what we didn’t expect was for this to be an iPad Pro. Rather than calling this the iPad Air 3, which it logically and visually appears to be, Apple is presenting it as a shrunk-down version of the 12.9in iPad Pro – and thereby attempting to position the new 9.7-inch iPad Pro as a work device suitable for replacing a laptop, and targeted particularly at designers and illustrators on the go.

But does it succeed? In our iPad Pro 9.7in review, we evaluate the latest iPad’s design and build quality, weigh up the pros and cons of its new features, put the device through the Macworld labs’ most rigorous speed benchmark and battery tests, and compare the value for money that the iPad Pro 9.7in offers compared to the other tablets on the market.

iPad Pro 9.7in review

iPad Pro 9.7in review: Summary of review

Design: Physically the iPad Pro 9.7 is a close match to the iPad Air 2: weight and dimensions are identical, as is the general design (which remains sumptuous, of course). You now get four speakers – two at the top, two at the bottom – and the bottom speakers are spaced slightly further apart. This results in a much fuller, richer sound – not exactly surround sound, but a far more immersive audio experience than we’ve come to expect from a tablet.

Cameras: One other noticeable physical change is the rear-facing camera, which now sticks out and will scratch on the desk if you lay the iPad flat on its back. Slightly annoying, that, although any sort of case will remove this issue, and you do get the payoff of a heavily enhanced camera setup. The rear-facing camera now has a flash, and has been pushed from 8 megapixels (on the Air 2 and the Pro 12.9in) to 12Mp; there are also numerous smaller improvements to this component.

The front-facing camera is even more dramatically boosted, going from 1.2Mp to 5Mp and gaining the Retina flash feature. We look at all this in more detail, and present a selection of test shots and comparisons, in the camera testing section, but suffice it to say that in some conditions you won’t notice the difference from the Air 2’s cameras, in others you’ll notice small improvements, and in others it’s in a whole different class.

Screen: The 9.7-inch touchscreen Retina-class display is in most respects the same as that on the Air 2: same size, same resolution and pixel density, same sharply responsive multitouch functionality. But it adds a new (and optional) feature called True Tone, designed to subtly adjust the screen’s colour output to account for environmental light conditions. And we do mean subtly – it’s a similar kind of idea to Night Shift, producing a warmer, yellower colour palette under electric lighting, but to a much less noticeable degree. We imagine most users will only be dimly aware that the screen seems to have good colour output without being sure why; we saw a clear difference only by sitting it next to the (non-True Tone) iPad Air 2 in various conditions.

Speed: Thanks to its A9X processor chip, the Pro 9.7 is significantly faster – at least on paper – than the Air 2, and in most tests very nearly as quick as the iPad Pro 12.9 despite having half as much RAM. For the time being you won’t notice much difference between the Pros and Air 2, but the older device is sure to get left behind as more and more processor-intensive apps and games are released with the newest generation of hardware in mind. s

Battery: Early battery testing was also impressive, with the Pro 9.7 lasting, surprisingly, 11hrs 11m in GeekBench 3’s highly demanding benchmark despite having slightly lower battery capacity than the Air 2 (which managed just 7hrs 40m) – although stay tuned for repeat tests. Both devices should last longer than that in general use.

iPad Pro 9.7in review

Accessories: Crucially for its credibility as a laptop replacement, the Pro 9.7 has launched alongside a new keyboard case, a 9.7in version of the Smart Keyboard, and like the Pro 12.9 it features a port on its lefthand edge for connecting to and powering this accessory. It’s about as good as an ultraportable keyboard of its size could be, but nowhere near as accurate to type on as a conventional keyboard (and some way behind the larger 12.9 version of the Smart Keyboard, too). It does a job, but you’ll need to rely on either a solid autocorrect (like the one in Pages), frequent manual corrections, or just lots of practice.

You can also now use the Apple Pencil stylus, which is pretty wonderful, but expensive.

UK pricing: The Pro 9.7in starts at £499 in the UK, with prices rising to £839 for the 256GB cellular model. You’re paying a premium, then, and many Apple fans will baulk at the asking price. But we think there are enough enhancements here to justify it, and business users – if they can live with the smaller and harder-to-use keyboard attachment – will get a lot out of this device. It’s still a cool £180 cheaper than the Pro 12.9, remember, and that device doesn’t get the True Tone display or most of the camera upgrades.

That’s the summary of our iPad Pro 9.7 review, but let’s look again at each of those areas in more detail – before finally giving our definitive verdict.

iPad Pro 9.7in review
[Source:- Macworld]

Office 365 is king of business web apps, but Slack is growing fastest

Office 365 is king of business web apps, but Slack is growing fastest

Which is the most popular business app used online? Unsurprisingly, it’s Office 365, the subscription version of Microsoft’s productivity suite, according to some new research which details the most-used web apps.

These figures were revealed by Okta, a firm which produces software to manage employee logins to online services. The company found that among its customers, Office 365 was king of the enterprise cloud apps, followed by Salesforce.com, Box, Google Apps for Work, and in fifth place was Amazon Web Services.

Okta also made an interesting observation regarding Office 365 and Google Apps both being used within the same organisation. Indeed, data showed that over 40% of companies use both of these services due to preferences for one or the other in different departments.

Not slacking

As for the fastest growing business app, that was Slack, which witnessed a growth rate of 77% in the second half of 2015. We can expect Slack to put in a very good showing this year, by all accounts, as it’s continuing to pick up the pace with “no sign of slowing down just yet” Okta says.

Adobe’s Creative Cloud also had a good year in 2015, growing its user numbers by 44% according to the report.

One final nugget on business security for you: Okta found that 30% of organisations are now using multi-factor authentication, a number that still needs to increase in an ideal world.

[Source:- Techrader]