Apple’s winning streak is soon to end

By THE DATA TEAM

APPLE posted the largest quarterly earnings of any company, ever, yesterday. It made $18.4 billion in profit in the three months to December 26th 2015, beating the record it set a year earlier by a few hundred million dollars. But that’s in the past. The word on the street is all about how Apple will fare next quarter. Thanks to turmoil in emerging markets, chiefly in China, where it makes a quarter of its sales, quarterly revenue is expected to fall by about 11% year-on-year. That would mark the end of a remarkable run for Apple—51 quarters of consecutive year-on-year revenue growth—just as it nears completion on its $5 billion new HQ.

Apple’s fortunes are dominated by the iPhone, from which it earns around two-thirds of its revenues. Over the past ten years the company has sold 900m iPhones, compared to: 350m iPods, 300m iPads and 140m Macs. The much-hyped smartwatch has sold perhaps 12m-15m units since it was launched in April, earning around $4 billion in revenue. Nevertheless, Apple can now boast a new landmark: one billion active devices over the past 90 days. Add to that a $150 billion cash-pile—the “mother of all balance sheets” in the words of Tim Cook, its boss—and the company remains in rude health.