Apple reports Q2 revenue down 4% YoY to $90.75B, net income down 2% to $23.64B, and announces a $110B share buyback, its largest yet

Apple 2024-05-04

Context & Ripple Effects

Apple’s latest quarter extends a weaker top-line stretch that included a 3% year-over-year Q2 revenue decline in 2023 and a subsequent Q4 revenue decline. The contrast with 2022’s revenue growth and $90B repurchase authorization highlights how Apple has continued to use capital returns across markedly different operating conditions.

First-order effects

Apple is directing an additional $110B toward potential share repurchases while reporting lower revenue and net income, prioritizing shareholder distributions alongside a softer quarter.
Shareholders gain authorization for Apple’s largest buyback program, while the company retains discretion over the timing and amount of actual purchases.

Second-order effects

The authorization makes capital allocation a larger part of the near-term investor case: repurchases can reduce shares outstanding if executed, potentially supporting per-share results even when total profit is under pressure.
Other large technology companies face a clearer comparison point for how much excess cash investors may expect to be returned rather than deployed elsewhere.

Third-order effects

If repeated, this pattern would reinforce a mature-platform model in which large tech companies pair uneven hardware-cycle revenue with increasingly consequential capital-return programs.
The trade-off between buybacks and operating investment will become a more durable measure of how investors assess growth opportunities at cash-rich technology firms.

The trend: Large consumer-tech platforms are leaning more heavily on capital returns to sustain shareholder value through uneven revenue cycles.

Discussion

@lukehurd Luke Hurd on threads
Dear Meta Quest and Apple Vision Pro, For mind-blowing AR, we need realistic virtual objects. This requires access to the camera feed so that reflections and lighting will match the physical environment of the user. Currently, neither of you support this. …
@carnage4life Dare Obasanjo on threads
Price is up after hours because of an unprecedented $110 billion stock buy back
@jerrycap @jerrycap on x
Apple buying back stock while Google, Amazon, and Microsoft build the future. #AbsoluteZero
@carnage4life Dare Obasanjo on x
Apple's earnings are out and are poor as expected given the reports of iPhone sales slowdowns. ∙ iPhone revenue -10% ∙ Mac revenue -3.9% ∙ Wearable revenue -10% ∙ Services revenue up +14% ∙ Overall revenue -4% Only growth is taxing apps 30% https://techcrunch.com/...
@munster_gene Gene Munster on x
One thought on Capex and AI investments going into the call. They increased the buyback by more than I was expecting which is a sign that they feel good about their ability to generate profit over the next year. On a smaller point: They do want to move the net cash balance...
@supbagholder @supbagholder on x
Apple seems very enthusiastic about Vision Pro in the enterprise sector... they've hinted at enterprise use cases and interest 3 or 4 times during the call. In contrast, there was barely any mention of excitement from consumers about Vision Pro.
@munster_gene Gene Munster on x
The $AAPL call just wrapped up. Shares up about 7%, about the same as when the call stated.
@markgurman Mark Gurman on x
This could mean like 2-3 headsets per company, to be clear.
@donmiami3 Don Johnson on x
Tim Cook: I may be turning Apple into the next IBM but I can blow all of our cash to pop the share price to prices seen a month ago
@donmiami3 Don Johnson on x
It's amazing that dogshit short term decision making is rewarded over innovation and future revenue expansions. Cook's recent Apple moves highlight that the only thing he knows how to do is perform buybacks well.
@neilcybart Neil Cybart on x
Analyst to Apple: How will you make money from AI? Tim Cook: We see generative AI as a “key opportunity across our products.” We believe we have advantages that set us apart there. We will talk about that in the weeks ahead.
@metacriticcap @metacriticcap on x
My man Tim Cook will pass the AI revolution and a shot at AGI because buying a growthless competitive pressured handset maker at 27x P/E is the opportunity of a lifetime. $AAPL [image]
@htsfhickey Fred Hickey on x
Apple revenues down 4% Y/Y. International revenues down 6%, iPhone sales -10% Y/Y, Greater China revenues -8.1%, Japan revenues -13%, net income down 2.2% Y/Y. But they slightly “beat” what everyone knew were “low-ball” estimates...And this crap report justifies a $13 (7.5%) jump…
@sadlyitsbradley Brad Lynch on x
Apple has announced that half of the Fortune 100 companies have purchased Vision Pros from them thus far (In their quarterly earnings call)
@neilcybart Neil Cybart on x
Apple repurchased $23.5 billion of AAPL shares last quarter in open market purchases. Basically an all-time record pace.
@neilcybart Neil Cybart on x
Apple 3Q24 Guidance. - Revenue: June quarter revenue to grow low single digits despite FX headwind. - Margin: 45.5% to 46.5% That's good guidance.
@neilcybart Neil Cybart on x
Apple increased its quarterly dividend to $0.25/share (up a penny). We are at the point where Apple's board is increasing the dividend at the slowest rate possible. Yes, an increase is an increase. But Apple remains very stingy with its cash dividends.
@munster_gene Gene Munster on x
$AAPL Big Picture. Things get easier for Apple in the back half of the year.
@lexnfx Alexei Oreskovic on x
$AAPL investors sigh of relief on China rev down only 8% (some analysts estimated China iPhone sales down as much 19%) But Apple's longterm China decline is striking: In 2022, Apple had $44 billion in China revenue in 6 months thru end of March That number is now $37 billion
@scobleizer Robert Scoble on x
Yup, as I said the other day, Apple just reported awful results, but the stock market likes what it sees, up 4% after hours.
@tomwarren Tom Warren on x
Apple Q2 2024 earnings are out: 📱 iPhone revenue down 10% 💻 Mac revenue up 3.9% 📑 iPad revenue down 17% ⌚ wearable revenue down 10% ☁️ services revenue up 14% $90.8 billion in revenue overall, down 4% [image]
@mgsiegler M.G. Siegler on x
Wearables revenue 👀😬
@jsnell Jason Snell on x
Just posted: 2024 Q1 Apple Results: $90.8 billion revenue, Services record https://sixcolors.com/...
@markgurman Mark Gurman on x
Apple sales declined less sharply than feared last quarter, helped by stronger-than-expected demand in China, sparking optimism that the company's slowdown may be easing. https://www.bloomberg.com/...
r/economy r on reddit
Apple plans record $110 billion share buyback amid challenging earnings report
r/stocks r on reddit
Apple announces largest-ever $110 billion share buyback as iPhone sales drop 10%
r/dividends r on reddit
Apple Raises Dividend by 4% and Authorizes a $110 Billion Stock Buyback
r/wallstreetbets r on reddit
Apple's $110 Billion Stock Buyback Plan is Largest in US History
r/apple r on reddit
Apple reports second quarter results (FY24)

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