US stocks have slumped as trade tensions between the world’s two largest economies overshadowed positive earnings for Apple and the yield on 10-year Treasuries touched 3% for the first time since June.
Trade tensions between the US and China boiled and a measure of American manufacturing fell short of estimates. Apple rose to a record, lifting the Nasdaq 100.
Apple shares jumped over 5% after the company projected sales that suggest consumers are still snapping up the company’s expensive iPhones even as updated models are on the horizon.
The company had said late on Tuesday evening it expects fiscal fourth-quarter revenue between $60bn and $62bn. Analysts were looking for $59.4bn (€50.7bn), and fiscal third-quarter results also beat Wall Street expectations.
Apple’s stock has gained 18% this year putting the iPhone maker on a path to become the first US-based company with a market value of $1tn.
“These results and guidance will increase investor confidence,” Shannon Cross of Cross Research wrote in a note to investors.
“We expect the vast majority of Apple’s product line-up to be refreshed during the next couple of quarters which should support near-term results,” she said.
More than a decade after its debut, the iPhone is still Apple’s most important product, accounting for about 60% of revenue.
While unit sales have slowed recently, the company is building digital services and a suite of other gadgets around the device.
Those newer businesses, along with higher iPhone prices, have supported revenue growth. Apple’s fiscal fourth-quarter outlook is closely watched because this is usually the period when the company unveils new iPhones.
The company is expected to launch three new phones later this year. That has raised Wall Street expectations for more sales and profit.
The results “were driven by continued strong sales of iPhone, Services and Wearables, and we are very excited about the products and services in our pipeline,” said Tim Cook, Apple’s chief executive.
Fiscal third-quarter sales rose 17% to $53.3bn, Apple said. Profit came in at $2.34 per share. Analysts expected revenue of $52.4bn and earnings of $2.18 a share.
The company sold 41.3 million iPhones in its third quarter, generating revenue of $29.9bn. That was driven by a higher average selling price of $724, thanks in part to the iPhone X, the price of which starts at $999.
Analysts were looking for 41.6 million iPhone units in the quarter, and an average selling price of $699, according to estimates compiled by Bloomberg News.
During a conference call with analysts, Cook said the iPhone X was the most popular iPhone in the fiscal third quarter, gaining market share around the world.
Apple reported record services revenue of $9.55bn, up 31% from a year earlier. The category includes the App Store, Apple Music, iCloud storage and Apple Pay. The company is working on expanding these offerings with original videos and a news subscription service.
Cook told analysts that Apple is on track to meet a goal of doubling services revenue by 2020. Paid subscriptions have now passed 300 million, he said.
Apple said it sold 11.6 million iPads in the quarter, up from the 11.4 million in the year-ago period.