Apple Q1 2025 Earnings Overview

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Note: Q1 FY2025 refers to the quarter ending Dec 28, 2024.

• Key Financial Metrics (Q1 FY2025):
  • Revenue: $124.3 billion (+4% YoY) - All-time record.
  • Net Income: $36.33 billion (+7% YoY).
  • EPS (Diluted): $2.40 (+10% YoY).
  • Services Revenue: $26.3 billion (+14% YoY) - All-time record.

Why It Matters: Apple started its fiscal 2025 with its best quarter ever, showcasing the strength of the iPhone 16 cycle and the continued momentum in its high-margin Services business, despite broader economic headwinds.

• Performance Analysis (Q1 FY2025):
  • Drivers: Robust holiday demand for iPhone 16 lineup, record Services revenue fueled by over 1 billion paid subscriptions. Strong performance in emerging markets highlighted. Operating margins remained strong.
  • Management Guidance (for Q2 FY2025): Guided for accelerating iPhone and Services growth, but acknowledged tough comparisons for Mac/iPad.
  • Analyst Reactions & Sentiment: Results generally beat expectations. Focus remains on services growth sustainability and navigating macro/regulatory challenges.

Why It Matters: Q1 performance confirms the power of Apple's ecosystem and brand loyalty. Management commentary points towards continued Services strength offsetting potential hardware cyclicality.

• Financial Trends (FY2024):
  • Historical EPS/Revenue: FY2024 revenue $391.0B (+2% YoY), Net Income $93.7B (-3% YoY due to one-off tax charge). EPS $6.08 (roughly flat YoY). Revenue has plateaued around ~$390B after strong growth in 2021-22.
  • Key Financial Ratios (Approx. recent TTM):
    • P/E Ratio: ~30.7x - 31.3x.
    • Price/Sales: ~7.5x.
    • Current Ratio: ~0.92 (Low ratio offset by strong cash flow).
    • Quick Ratio: ~0.78.
  • Free Cash Flow: Strong and growing, reaching $108.8 billion in FY2024. FCF per share supports massive buybacks.

Why It Matters: While top-line growth has slowed recently, Apple's profitability remains exceptional, driven by services and premium hardware. Robust FCF allows significant capital returns and strategic flexibility.

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