Summary

Against all hopes, Apple (AAPL) reported a great quarter.

The success of the iPhone SE should continue benefiting Apple.

Investors can expect the iPhone 7 to be packed with many new features.

Due to the increasing diversification, Apple still looks like a good buy.

I Know First maintains a bullish stance on AAPL.

Source: Google Finance

I have been bullish on Apple over the last few months. I have recommended buying Apple on the pullback several times and the company has finally delivered. After reporting several weak quarters over the last one year, Apple finally delivered a stellar quarter this time around.

In the most recent quarter, Apple shared revenue of $42.4 billion, which was ahead of the analysts’ estimates, along with gross margin of 38 percent. The company accomplished these figures by decreasing its channel inventory by about $3.6 billion, considerably more than the $2 billion inventory decline Apple had earlier projected.

Despite surpassing the quarter’s estimates, sales understandably declined 14.5 percent year over year. The company shipped 40.3 million iPhone units versus 40.02 million projected and 9.95 million units of the iPad as compared to the estimated 9.1 million.

iPhone SE was a Huge Success

Surpassing shipments estimates of both the iPhone and the iPad certainly helped Apple perform well in the last quarter. However, it was the iPhone SE that proved to be the standout performer for Apple.

Apple reported that it had a prosperous worldwide launch of iPhone SE, with demand exceeding supply all the way through the quarter. Apple’s initial sales signifies that the iPhone SE is famous in both developed as well as emerging markets, and the amount of iPhone SE sales going to consumers who bought iPhone for the first time is greater than the company’s management had seen during the starting weeks of the launch of other iPhones.

Smartphone industry has almost peaked and is ready to evolve. The smartphone market is maturing, and this is the reason why stockholders should not anticipate identical type of performance that Apple produced throughout the initial growth phase. On the other hand, this does not essentially mean that sales will keep falling in the imminent years.