SAN FRANCISCO, May 2, 2018 (News Wires) - Apple Inc reported resilient iPhone sales in the face of waning global demand and promised $100 billion in additional stock buybacks, reassuring investors that its decade-old smartphone invention had life in it yet. Apple's quarterly results topped Wall Street forecasts, which dropped ahead of the report on growing concern over the iPhone. The Cupertino, California-based company also was more optimistic about the current quarter than most financial analysts, driving shares up 3.6 percent to $175.25 after hours. Suppliers around the globe had warned of smartphone weakness, playing into fears that the company known for popularizing personal computers, tablets and smartphones had become too reliant on the iPhone. Sales of 52.2 million iPhones against a Wall Street target of 52.3 million was a comfort and up from 50.7 million last year, according to data from Thomson Reuters I/B/E/S. Apple bought $23.5 billion of stock in the March quarter, and said it planned to hike its dividend 16 percent, compared with a 10.5 percent increase last year. Analysts believe the heavy emphasis on buybacks will bolster share prices, but some investors wished Apple had found different uses for the cash. "I'd hoped for more on the dividend side or maybe a strategic investment," said Hal Eddins, chief economist for Apple shareholder Capital Investment Counsel. "I assume Apple can't find a strategic investment at the current prices that will move the needle for them. The $100 billion buyback is good for right now but it's not exactly looking to the future." The cash Apple earmarked for stock buybacks is about twice the $50 billion market capitalization of electric car maker Tesla Inc. Apple posted revenue for its March quarter of $61.1 billion, up from $52.9 billion last year. Wall Street expected $60.8 billion, according to Thomson Reuters I/B/E/S. Average selling prices for iPhones were $728, compared with Wall Street expectations of $742. The figure is up more than 10 percent from $655 a year ago, suggesting Apple's iPhone X, which starts at $999, has helped boost prices. Analysts had feared the high price was muting demand for the iPhone X, but Apple Chief Executive Tim Cook said it was the most popular iPhone model every week in the March quarter. "This is the first cycle that we've ever had where the top of the line iPhone model has also been the most popular," Cook said during the company's earnings call. "It's one of those things like when a team wins the Super Bowl, maybe you want them to win by a few more points. But it's a Super Bowl winner and that's how we feel about it." The iPhone X has shaped up to be "a good, not a great product. There was a time prior to its introduction that investors expected it to be a great product," said Thomas Forte, an analyst with D.A. Davidson Companies. "Now that we know it is a good product, as investors have lowered expectations, that is enough, in my view, for shares to go higher from current levels."
