Apple posts higher profits, unveils big share buyback plan

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The tech giant also unveiled a new US$100 billion share repurchase plan and a 16 percent hike in dividend.

Though Apple exceeded analysts' expectations in India, investors are concerned over its slowing growth in major markets such as the United States and China.

This is 16 per cent up on figures posted for the same quarter in 2017.

That came on top of $22.8 billion in buybacks executed in the prior quarter, "a record amount for any issue in any quarter", analyst Howard Silverblatt said. The Average Selling Price (ASP) for the iPhone is up from $655 during the same period previous year to $728.

Apple's Services and "other products" businesses saw the most impressive growth during the second quarter, with sales of $9.1bn (up 31 per cent) and $3.95bn (up 38 per cent).

"The Services segment will grow between 13% and 20% per year over the next five years driven by continued growth in existing services along with new, innovative services", Gene Munster, co-founder of Loup Ventures and a veteran Apple analyst, wrote in an email following the results on Tuesday. A year ago the lowest-priced iPhone, the iPhone 8, had a starting price of $699.

For the current quarter, which ends in June, Apple said it expects sales of $51.5 billion to $53.5 billion, with the midpoint higher than the $52 billion expected by analysts, according to a poll by Yahoo Finance. In after hours trading AAPL stock spiked as high as 4.2%. The firm believes that Apple's shares have to digest stronger-than-anticipated results after absorbing significant reductions in iPhone unit expectations that it believes is likely to have a tail through the year and the launch of the iPhone X V2.

This adds weight to the rumours that Apple's Siri-powered HomePod speaker isn't selling too well, with recent reports claiming that the company has been forced to lower sales forecasts and cut orders with suppliers.

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Apple Inc is betting on services such as app downloads and music subscriptions to help drive growth as the cell phone market matures, but the company faces tough competitors and potentially low-profit margins in some of its target areas.

Cook suggested new services are in the works and that Apple's installed base of devices grew by double digits from a year earlier.

Analysts had been anxious that sales in of its iPhone had been weak, especially the newest iPhone X.

One piece of data that doesn't seem to jive with Cook's comments about the premium priced iPhone X, is the Average Selling Price of iPhone units sold during the fiscal second quarter. But it's a Super Bowl victor and that's how we feel about it.

With some $61.1 billion in revenues, Apple has reported its best quarter March.

Cook stressed that the smartphone market is like the best market for a consumer product company in the history of the world. Apple's shares dipped 5.8 percent over the past month after several reports said the Cupertino, California, company was cutting back on production of the iPhone X because of poor sales.

"According to our estimates, iPhone X's production volume fell by 50% in the first quarter compared to the fourth quarter", Huang said.

"I don't buy the view that the market is saturated", he said.