After 15 years leading Apple to become a moneymaking behemoth worth nearly $5 trillion, Tim Cook bid adieu to Wall Street on Thursday.
“I just wanted to take a moment to say thank you to all of you,” Mr. Cook said in a call with analysts and investors after Apple reported quarterly financial results. “We have a bright future ahead, and I truly have never been more optimistic.”
Mr. Cook, 65, is passing the baton while Apple is at a financial high — with some caveats. The company on Thursday reported that revenue grew 16 percent from a year earlier to $109.42 billion, the most for a quarter ending in June. Profit rose 27 percent to $29.8 billion.
But Apple’s projected revenue for the current quarter fell short of analyst expectations. The company said revenue would grow between 9 and 11 percent from a year earlier, while analysts expected about 12 percent. Mr. Cook said that was because the company had a “supply constraint” in a process used for producing its chips. Apple also expects currency exchange rates to be worse from the previous quarter.
The company’s share price fell as much as 8 percent in after-hours trading on Thursday.
These results are the last Apple will report with Mr. Cook as chief executive. He will step down and become the company’s executive chairman in September. He will be succeeded by John Ternus, 51, who most recently was Apple’s head of hardware engineering. Mr. Cook said that the transition was “going seamlessly,” and Mr. Ternus said the company was “very excited” about artificial intelligence.
“There is so much opportunity for us with everything that’s happening in this space,” Mr. Ternus said during the call. “We’re just really focused on our plans.”
Mr. Ternus is inheriting a company that is still one of the world’s most dominant. Apple this week reclaimed the title of the most valuable public company in the world, amid growing concerns over spending on A.I. The company is still enjoying the popularity of the redesigned iPhones it introduced last September, even as it raised prices on its Macs and iPads last month, citing a global shortage in memory and storage chips. It expects to pay even more for memory in the current quarter.
“We’ve just seen really, really strong levels of demand throughout the year, and I think, in general for iPhone and Mac, much higher than we expected,” Kevan Parekh, Apple’s chief financial officer, said in an interview. “The supply chain just hasn’t had the same level of flexibility that we’ve seen in previous years where we can go and chase that higher demand.”
The new designs Apple unveiled for the iPhone included a thin model called the iPhone Air and a model of the iPhone Pro with a raised bump across the back for cameras. The company also increased the prices of some phones by $100. The changes have continued to lift iPhone sales, which grew 22 percent to $54.25 billion.
Apple also continued to recover from years of sluggish sales in China, the largest smartphone market in the world. Its iPhones made up 18 percent of smartphone shipments to distributors in China in the quarter — more than many local rivals — after lagging a year earlier, according to Counterpoint Research, which tracks the smartphone market. Apple’s sales in China rose 22 percent to $18.82 billion.
The results topped most of Wall Street’s expectations. Analysts had predicted quarterly revenue of $108.85 billion and profit of $27.73 billion, according to FactSet.
“Their numbers are very good,” said Jitesh Ubrani, a director of consumer devices research at IDC, a technology research firm. “The biggest concern is, going forward, how do they handle the memory crisis? Because their costs will rise. That’s the biggest piece of anxiety for investors.”
Apple’s services revenue grew 12 percent to $30.74 billion, slightly less than analysts had expected. This month, the company quietly raised the prices for some of its services such as its music streaming service Apple Music, which now costs $11.99 per month, up from $10.99.
Apple saw modest growth in other parts of its core business. The company introduced in March a line of colorful entry-level laptops, called the MacBook Neo, driving sales of Macs, which rose 29 percent to $10.35 billion. Sales of wearables, which include products like the Apple Watch and AirPods, grew 6 percent to $7.88 billion. Sales of iPads fell 6 percent to $6.19 billion.
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