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When Apple released the 16th version of its iPhone in September, some tech reviewers described it as an incremental improvement over earlier models.
Apple’s customers didn’t care. They bought the new iPhone 14 in droves.
On Thursday, the world’s most valuable company said that strong demand for iPhones helped it increase total revenue by 8 percent to $90.1 billion for the three months that ended in September, bringing an end to a fiscal year in which it posted sales gains every quarter. The company reported that profits rose nearly 1 percent to $20.7 billion.
The company said iPhone sales increased 10 percent to $42.6 billion in the quarter that ended in September, a major deceleration from the 47 percent increase it reported in the same period last year. The signature product accounts for about half of the company’s total revenue.
During a call with analysts, Apple said its business was slowing down in the current quarter, with a deceleration in sales of Macs and services. In noting the slowdown, it joined peers like Google, Amazon and Microsoft in warning that their business are being hobbled as the economy weakens.
Though Apple’s earnings exceeded analysts’ forecasts, its shares initially fell in after-hours trading before turning around and rising more than 1 percent to $146.20. The shares had fallen 3 percent before the market closed.
Tim Cook, Apple’s chief executive, said that the company was facing inflationary pressure on wages and device components. Those factors, as well as a strengthening dollar, contributed to price increases on devices sold internationally.
Some Wall Street analysts have pointed to Apple as a safe haven for investors amid a slowing economy. In a year when smartphone sales are contracting, the iPhone has expanded and stolen market share. The company’s other businesses, including the App Store, Apple Watch and AirPods, are also growing, though they don’t come close to the scale of iPhone sales.
Other analysts are unconvinced. They see the economic slowdown buffeting the company’s two largest markets, the United States and China, and worry that Apple will be caught in the downturn. They predict that the iPhone’s business will dim, just…