Apple posted strong Q1 2025 results, consolidating its market position with record sales of $124.3bn and earnings per share of $2.40. The development of Apple Intelligence and the company’s expansion into new markets were significant drivers of growth, and the company’s CFD rose 3.4% to $245.62 pre-market.
At Apple's annual press conference, CEO Tim Cook addressed the potential impact of DeepSeek AI on the company’s business, stating that “innovation that drives efficiency is a good thing” and highlighting Apple’s tight hardware-software integration, as well as its hybrid approach to on-device and cloud computing. He also emphasised Apple’s careful investment strategy for long-term growth.
Apple Intelligence driving growth
Cook highlighted Apple Intelligence as an essential part of the iPhone 16's success, with sales figures significantly stronger in markets where the technology is available. Features like Writing Tools, Image Playground, Genmoji, and the improved Siri were especially well-received.
Starting in April, Apple plans to expand Apple Intelligence to additional languages, including German, French, Spanish and Chinese. This could further boost global sales and reach new customer groups.
iPhone division continues to deliver
The iPhone remains Apple's most important mainstay, generating $69.1bn in sales and setting new records across multiple countries. Cook emphasised that the iPhone 16 Pro, with its enhanced camera and battery functions, was particularly well-received, and the number of upgrades to new models is higher than ever.
Strong growth from Mac and iPad
Mac revenue rose 16% year-over-year to $9bn, driven by strong demand for M4-based MacBooks and iMacs, as well as Apple Intelligence integration. iPad revenue also grew by 15% to $8.1bn, with the new iPad Mini and iPad Air models selling particularly well.
Mixed results from wearables and Apple Vision Pro
While the Apple Watch and AirPods gained traction with new health features like sleep apnea detection and enhanced hearing aids, its revenue from wearables, home and accessories dipped slightly to $11.7bn. Apple Vision Pro's global rollout continued, with growing market acceptance.
Apple Services: a billion-dollar success
Apple's services revenue hit a record $26.3bn. Apple TV+ showed strong growth, attracting worldwide attention with hits like Severance and the upcoming film F1 starring Brad Pitt. The "Find My" feature was also upgraded, allowing airlines to track lost luggage with AirTags.
Expanding into new markets
Apple continues to expand into emerging markets. India has been identified as an important growth market, with Apple planning to open four new stores in the country, as well as flagship stores in Saudi Arabia. Tim Cook also highlighted efforts to strengthen Apple's online presence in these regions to meet rising demand.
Looking at China: challenges and opportunities
China remains a tough market, with an 11% sales drop attributed to reduced distribution channels and inventory issues. However, a new government subsidy plan could drive growth in the next quarters.
Strong positioning for the future
Apple is well-positioned for continued growth, driven by the global expansion of Apple Intelligence, a strong product lineup, and service diversification. The coming quarters will reveal the impact of its strategies, especially in China and emerging markets.
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