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Apple admits future products may never be as profitable as iPhones



Apple has warned investors that its future new products will never be as profitable as the iPhone.

The company issued the warning in a recent securities filing as part of a list of “risk factors” that could impact the business.

Apple, which was recently replaced by AI chip maker Nvidia as the world’s most valuable company, last week reported a 6% increase in revenue for the most recent quarter, although it said it had to make a profit during the current quarter. Weak growth is expected.

Apple has warned investors that its future products will likely not be as profitable as the iPhone. getty images

“New products, services and technologies may supersede or replace existing offerings and generate lower revenues and lower profit margins which could adversely affect the Company’s business…” Apple filed a filing with the Securities and Exchange Commission on September 28. said in a filing with.

It contained Apple’s warning Most recent 10-K regulatory filing – An annual report on company finances that publicly traded companies are required to submit to the SEC.

In previous years, Apple was not as direct on its 10-K filings when discussing new products and their potential profitability, According to Financial Times.

Instead, the company called new product introductions “higher cost structures”.

Apple also said in the filing that it is keeping an eye on “geopolitical tensions” that could potentially impact sales.

The Cupertino, California-based company is investing in AI in an effort to catch up to tech rivals like Google and Meta.

The sale of Apple’s new iPhone 16 series started on September 20. getty images

Fourth-quarter sales of Apple’s iPhone, the company’s main product, rose 5.5% to $46.22 billion, compared with analysts’ estimates of $45.47 billion. Other product lines missed expectations.

Apple’s fiscal fourth quarter ended on September 28, which means it reflects only a few days of sales of its iPhone 16 series that went on sale on September 20.

Apple CEO Tim Cook told Reuters that iPhone 16 sales grew faster than iPhone 15 sales from a year earlier, with both phones on sale for the same number of days in the fourth quarter.

The rollout of Apple’s artificial-intelligence strategy, which it unveiled this year, depends on how well its new phones sell.

Apple CEO Tim Cook told Reuters that iPhone 16 sales have grown faster than iPhone 15 sales from a year ago. getty images

Rather than introduce AI in a standalone app or service, Apple has sprinkled Apple Intelligence into its most recent operating systems as new features, like the ability to help rewrite emails in a more professional tone.

Those features will mostly be available on iPhone 16 models, which feature more powerful computing chips, although the Pro versions of the iPhone 15 both work with Apple Intelligence.

Sales at Apple’s services business, which includes iCloud storage and Apple Music, were $24.97 billion, according to LSEG, compared with analysts’ expectations of $25.28 billion.

According to LSEG data, Mac and iPad sales were $7.74 billion and $6.95 billion, respectively, compared to estimates of $7.82 billion and $7.09 billion.

Sales at Apple’s home and wearables business, which includes its Apple Watch and AirPods devices, fell to $9.04 billion, compared with estimates of $9.2 billion, according to LSEG.

with post wire

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