$46 Billion In iPhone Sales For Apple This Summer, Thanks To AI

Apple has bounced back from a slump in iPhone sales, demonstrating early signs that its recent efforts to revive demand through artificial intelligence (AI) are taking effect. During the July to September quarter, iPhone sales reached $46.22 billion, marking a 6% increase compared to the same period last year. This positive trend ended two consecutive quarters of declining sales.

Strong Financial Performance

The uptick in iPhone sales contributed to Apple’s overall quarterly revenue and profit surpassing analyst expectations, despite a significant one-time charge of $10.2 billion related to a European Union court ruling on back taxes. The company reported earnings of $14.74 billion, or 97 cents per share, which reflects a 36% decrease year-over-year. However, excluding the tax impact, Apple would have posted earnings of $1.64 per share, exceeding the analyst forecast of $1.60 per share. Total revenue climbed 6% to $94.93 billion, surpassing predictions by approximately $400 million.

While these results initially pleased investors, there was disappointment regarding Apple’s forecast for the upcoming October-December quarter, which suggested less robust revenue growth than expected. Following this announcement, Apple’s stock price dipped about 2% in after-hours trading, settling around $221, a significant drop from its recent peak of approximately $237.

AI Integration and iPhone 16 Launch

The quarterly results included the first days of sales for the new iPhone 16 lineup, featuring four models designed with various AI capabilities under the branding “Apple Intelligence.” This initiative aims to differentiate Apple’s approach to AI from competitors like Samsung and Google, who have been quicker to adopt the technology in smartphones.

Although the iPhone 16 was developed with AI features in mind, many of these capabilities were not activated until a recent free software update. This update introduced new functionalities for Siri, Apple’s virtual assistant, enhancing its performance and versatility—though these improvements are currently limited to the U.S. market.

“This is just the beginning of what we believe generative AI can do,” Apple CEO Tim Cook stated during a conference call with analysts. He also mentioned plans to expand AI features to other countries by December and to release further software updates that will enhance the iPhone 16 and select iPhone 15 models. These updates will introduce a connection with OpenAI’s ChatGPT, broadening the technology’s application.

Future Outlook and Consumer Upgrades

Investors are optimistic that the rollout of Apple’s AI features will encourage millions of users with older iPhones to upgrade to newer models to access the latest technology. “We believe it’s a compelling upgrade reason,” Cook asserted. However, analyst Thomas Monteiro from Investing.com believes that iPhone sales could be rising even faster if consumers were more impressed with Apple’s AI innovations, adding pressure on the company to enhance its public appeal.

(Includes inputs from online sources)

ALSO READ: Elon’s Starlink Meets India’s 6G: The Ultimate Power Couple?