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By Danielle Kaye and Paresh Dave
Jan 27 (Reuters) - Apple Inc on Thursday reported record sales in the holiday quarter, beating estimates as it benefited from high iPhone demand in China and withstanding supply chain constraints and Omicron variant disruptions.
Chief Executive Tim Cook had warned in October that chip shortages were affecting manufacturing of most Apple products and could lead to over $6 billion in lost sales.
Chief Financial Officer Luca Maestri told Reuters in an interview that the effect had indeed been more than $6 billion but that constraints would decrease in the current quarter, ending in March.
"The level of constraint will depend a lot on other companies, what will be the demand for chips from other companies and other industries. It's difficult for us to predict, so we try to focus on the short term," he said.
With few rival phones debuting in the holiday shopping season, the iPhone 13, which started shipping days before the quarter began, led to worldwide phone sales revenue for Apple of $71.6 billion, a 9% increase from the 2020 holiday season that handily beat Wall Street targets, according to Refinitiv data.
Apple's smartphone market share in China reached a record 23% in the holiday quarter, when it was the top-selling vendor there for the first time in six years, research firm Counterpoint Research reported on Wednesday.
The company's overall fiscal first-quarter revenue was $123.9 billion, 11% up from last year and higher than analysts' average estimate of $118.7 billion. Profit was $34.6 billion, or $2.10 per share, compared with analysts' expectations of $31 billion and $1.89 per share.
The pandemic has accelerated adoption of digital tools for communication, learning and entertainment, powering Apple to blowout sales across each of the company's segments, including computers, accessories and tablets.
Apple's services business, which covers paid apps such as Apple TV+, Apple Music and Apple Fitness, also has seen a big bump. Services revenue rose 24% to $19.5 billion, topping analysts' estimates of $18.6 billion. The company has 785 million paying subscribers across its offerings, an increase from 620 million a year ago and 745 million last quarter.
Sales for iPads fell 14% to $7.25 billion compared with analyst estimates of $8.2 billion, seeming to confirm industry predictions that iPads would have low priority for any scarce parts.
Sales for Macs rose 25% to $10.9 billion compared with estimates of $9.5 billion, and sales for accessories rose 13% to $14.7 billion compared with estimates of $14.6 billion.