Apple (AAPL 0.02%) stock popped in early trading on Friday, helping lift the entire market higher as well. The tech giant accounts for an outsized portion of the broader earnings of the S&P 500, making it among the most closely watched companies when earnings season rolls around. It also helps that the iPhone maker's market capitalization sits near $3 trillion.
Apple didn't disappoint investors with its late-Thursday earnings update. While sales declined, the slump was modest. And CEO Tim Cook and his team had some good news for investors to offset that sales weakness.
Declining sales
Revenue landed at $91 billion, down from $95 billion a year ago. The iPhone business was the main reason for this drop, as consumers were cautious in their upgrade commitments following the launch of the iPhone 15. Apple collected $46 billion from iPhone sales this quarter, down from $51 billion a year ago.
There was plenty of good news for investors, though, both around Apple's finances and in its non-iPhone businesses. The company's cash flow generation remained high at $63 billion over the past six months. Profit margin is rising, too. And the company committed to a much higher level of cash returns. Apple raised its dividend by 4% while describing a massive new stock buyback program that was nearly double its previous target.
Apple's services segment is expanding, too, helping offset much of the weakness in the iPhone unit.
New launches ahead
Investors won't have to wait long to receive further big updates from the tech stock leader. Apple is planning a new product announcement next week, executives said this week, and will likely detail its services growth plans during next month's developer's conference.
Still, the short-term outlook is modest for Apple achieving growth this year, as demand is soft for consumer tech products in key markets like the U.S. and China. The company can help offset that weakness with more service sales, but a big growth acceleration will depend on Apple launching new products that resonate with its massive customer base.
