Apple sales grow as Google enjoys record profits

Apple's strongest sales growth came from China, while revenue from Google advertising rose nearly 70%
Apple sales grow as Google enjoys record profits

Tim Cook, CEO of Apple.

Apple today reported quarterly sales and profits that beat analyst expectations as consumers bought premium versions of its 5G iPhones and signed up for the company's subscription services.

Driven by better-than-expected iPhone sales, total revenue hit $81.43bn (€68.89bn), which was above analyst expectations of $73.30bn, according to IBES data from Refinitiv. 

Earnings were $1.30 per share, above estimates of $1.01 per share, according to Refinitiv.

Apple's strongest sales growth came from China, where chief executive Tim Cook told Reuters that customers are buying up accessories such as the Apple Watch to pair with their iPhones. 

China sales grew 58% to $14.76bn in the fiscal third quarter ended June 26.

"It wasn't just iPhone. We set a new quarterly record for Mac, for wearables, home and accessories, and for services" in China, Mr Cook said. "It was our strongest geography."

Apple also appears so far to have avoided major hit from a global chip shortage.

The results come as investors who once worried that Apple was too dependent on sales of its signature computing device, the iPhone, have pushed the company's value to nearly $2.5tn, more than doubling in about three years.

Google sets record

Meanwhile, Google parent Alphabet reported record quarterly revenue and profit, powered by a surge in advertising spending amid more consumers shopping online, and beat analysts' estimates for both metrics.

Shares of Alphabet rose 5% in extended trading.

The digital ad market is booming, with consumers shifting to shopping largely online due to the pandemic, leading companies to rely on data gathered from customers' orders and online activity to launch new products and know their market better.

Alphabet said revenue from Google advertising rose nearly 70% to $50.44bn.

Ad revenue for the company's streaming video platform YouTube jumped 83.7% from the year-ago quarter to $7bn, as advertisers continued to used the site to reach viewers at home during the pandemic.

Total revenue of the internet's biggest supplier of search and video ads rose 61.6% to $61.88bn, well above Wall Street estimates of $56.16bn, according to IBES data from Refinitiv.

Net income during the quarter was $18.5bn, surpassing the previous record of $17.9bn in the first quarter.

Microsoft on cloud nine

Elsewhere, Microsoft beat Wall Street expectations for quarterly revenue, as demand soared for the software giant's cloud-based services with more people working and learning remotely.

The pandemic-driven shift to remote work has boosted consumer appetite for cloud-based computing, helping companies including Microsoft, Amazon's cloud unit, and Alphabet's Google Cloud.

Microsoft said revenue in its "Intelligent Cloud" segment rose 30% to $17.4bn (€14.7bn), with a 51% growth in its Azure cloud-computing business. 

Analysts had expected a 43.1% growth in Azure, according to consensus data from Visible Alpha.

Revenue from its personal computing division, which includes Windows software and Xbox gaming consoles, rose 9% to $14.1bn.

The company's revenue rose 21% to $46.2bn in the fourth quarter ended June 30, beating analysts' consensus estimate of $44.24bn, according to IBES data from Refinitiv.

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