Bulletin: Apple Inc. Returns To Growth As First Quarter Revenue Rises 3%

SAN FRANCISCO (S&P Global Ratings) Jan. 31, 2017--Apple Inc.'s (AA+/Stable/A-1+) revenues rose 3% year over year in the first quarter to $78.4 billion as a 5% growth in iPhone units and 18% expansion in services offset continued weakness in Greater China, which declined 12% year over year. The iPhone accounted for 69% of sales, again highlighting the product concentration risk, but we note that average selling price (ASP) rose nearly 1% to $695 year over year, reflecting the positive receptivity to iPhone 7 Plus. Adjusted EBITDA margin was near 36%, lower than a year ago, while free operating cash flow reached $24 billion for the quarter. Dividends and share repurchases totaled $14 billion but cash and investments grew by $8

...SAN FRANCISCO (S&P Global Ratings) Jan. 31, 2017--Apple Inc.'s (##+/Stable/A-1+) revenues rose 3% year over year in the first quarter to $78.4 billion as a 5% growth in iPhone units and 18% expansion in services offset continued weakness in Greater China, which declined 12% year over year. The iPhone accounted for 69% of sales, again highlighting the product concentration risk, but we note that average selling price (ASP) rose nearly 1% to $695 year over year, reflecting the positive receptivity to iPhone 7 Plus. Adjusted EBITDA margin was near 36%, lower than a year ago, while free operating cash flow reached $24 billion for the quarter. Dividends and share repurchases totaled $14 billion but cash and investments grew by $8 billion to $246 billion (94% of which is held overseas). Despite the maturing smart phone market, we expect Apple to rebound from a weak fiscal 2016 (albeit off of a record fiscal 2015) and grow near mid-single digits in fiscal 2017. With the 10-year anniversary of...

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