Apple announced its financial results for Q2 of the fiscal year 2020, and the company said that it experienced record revenue from services. While revenue from iPhones and Apple Watches declined, sales of iPads and Macs improved due to the COVID-19 crisis and people staying at their homes. Later, Apple CEO Tim Cook revealed more information during the company’s earnings call with investors.
During Apple’s earnings call for the quarter ending March 2020, Tim Cook revealed that the company is seeing positive demand for the 2020 iPhone SE from customers as well as reviewers. He said that the device offers more value and “faster than the fastest Android phones.”
Cook said that he expects the new low-cost iPhone to do well in markets with lower median income and that he expects a lot of Android phone users to switch over to the 2020 iPhone SE. When asked if Apple plans to change its pricing structure with the launch of the new iPhone SE, Cook said that Apple always “wants to give people the best deal that we can while making the best product.”
The Cupertino-based firm also revealed during the Q&A session that it is planning to offer Apple Card-based interest-free financing options to more products similar to what it did with the iPhone last year. Although the company allowed users to defer payments for their Apple Card bills for the past two months, Cook said that Apple doesn’t have plans to allow deferred payments right now.
The company announced that it plans to reopen Apple Stores in Australia and Austria 1-2 weeks. A few stores in the US will be opened in May 2020. Even when the company reopens its stores, it will have safeguarding measures such as health screening, social distancing, hand sanitizers, and reduced operating hours.
Regarding the development process of upcoming products, Cook told investors that everyone in the company is working hard. He said that due to work-from-home rules, some employees have seen higher productivity, while others have noticed reduced productivity, depending on the type of role. It’s a mixed bag, he said.
When asked about additional health products, the company said that it is looking at other areas. Tim Cook went on to say, “As you can tell from what we did this quarter despite the environment, we have our head down and are working because we know our customers want the products that we’ve got. They’re even more important in these times.”
Demand for iPads and MacBooks has increased since the COVID-19 lockdown, and the company said that it is in the process of delivering significant orders of iPads in the US. According to the company, it is about to deliver tens of thousands to Ontario, 100,000 iPads to Los Angeles, and 50,000 iPads to New York City. Apple has also seen record levels of usage for Final Cut Pro and Logic Pro after the 90-day free offer.
Apple appears to have a gross margin of a whopping 65.4 percent in its Services business. The company has 515 million paid subscribers across all services, which is 125 million more compared to last year. Tim Cook expects to double the revenue from the Services business by the end of 2020 when compared to 2016. Third-party subscriptions grew 40 percent year-over-year and are currently at an all-time high.[Via AppleInsider]