Apple shares were up 4 percent after the tech behemoth posted sales figures and profits that beat Wall Street's expectations, fueled by 5G iPhone upgrades. While revenue were at $89.58 billion against $77.3 billion expected, earnings per share touched $1.40 versus $0.99 projected.
Revenues from iPhone hit $47.9 billion even as analysts had expected $41.5 billion. Revenues from iPad sales accounted for $7.8 billion while the expectation was $5.6 billion. Mac revenues stood at a whopping $9.1 billion versus $6.8 billion expected.
"This quarter reflects both the enduring ways our products have helped our users meet this moment in their own lives, as well as the optimism consumers seem to feel about better days ahead for all of us," Apple CEO Tim Cook said.
"The last three quarters on Mac have been the strongest three quarters ever in the history of the Mac," Cook added.
Apple also said the second-quarter sales to China nearly doubled, led by $6.5 billion more in iPhone sales than predicted.
Significantly, Apple also said it was offering a $90 billion share buyback. This follows Google's decision to repurchase Alphabet's $50 billion worth of stock.
However, Apple Chief Executive Tim Cook and Chief Financial Officer Luca Maestri said the tech giant faced a chip shortage in the second quarter and that the costs from the shortage in the third quarter could surge to between 3 billion and $4 billion.
The shortfalls affect primarily the iPad and the Mac. "We'll have some challenges in there," Cook said. Maestri said he revenue for the quarter will grow by strong double digits year over year.
IPhones drove Apple's phenomenal growth during the pandemic year, analysts said. Consumers upgrading to 5G also fueled Apple sales, Haris Anwar, senior analyst at Investing.com, told Reuters. "Stimulus checks and the successful vaccine rollouts are certainly helping to boost consumer demand for tech gadgets across the board," he said.
Apple shares have gone up some 93 percent over the past year, compared to a 61 percent rise for the Nasdaq 100 index.
Meanwhile, some analysts said the high growth figures for iPhones and iMac could face headwinds in the months ahead as the world beats the pandemic. The robust sales of Mac and iPad segments could slow down according to Goldman Sachs' Rod Hall. "In our opinion, current high levels of both iPad and Mac demand are unlikely to be sustainable as the world re-opens," Hall said, according to Yahoo Finance.