Apple boosted its Q2 revenue by 7% to $45.4 billion year-on-year following healthy growth of its Apple Pay, Store and Music business. Stocks surged over 5% in after-hours trading.
This is good news for investors who have previously feared slowed growth as excitement for iPhones and iPads has died down a little.
The company expects revenue to grow further till the end of the year, as it is set to release a new iPhone next month.
Overall, iPhone sales during the quarter increased 2% driven by LatAm countries and the Middle East.
Meanwhile, iPad sales climbed 28% whilst revenues from products jumped 2%. Revenue from other devices including Apple’s Watch or TV increased 23% compared to the previous year.
Whilst leaks of its upcoming iPhone may have tempered with demand for existing models as people hold out for the new version, overall the firm’s performance has been strong.
Apple also said that its Pay app, Store and Music unit reached sales of $7.3 billion, an increase of 22% during the second quarter of 2017. Indeed, Apple Pay now makes up 90% of mobile payment transactions worldwide.
However, it’s not all good news for the company. Revenues in China slipped 9.5% to $8 billion. Given strong local competition, its iPhone has lost market share. On top of that, Apple has to deal with strict censorship regulations in China.
According to IDC, iPhone shipments in China dropped 27% the year over. The availability of sophisticated clones of its flagship product has made it easier for consumers to opt for cheaper versions.
Now, Apple has been trying to adapt its business model by boosting its app services in China. The company even removed 60 virtual private network (VPN) apps from the App Store in order to comply with regulations.