New, Must-Read Quotes From Apple, Inc. CEO Tim Cook

After Apple reported record third-quarter earnings on July 21 that somehow sparked an unjustified sell-off with shares falling as much as 9%, Apple CEO Tim Cook and CFO Luca Maestri calmed investors during the quarterly conference call. Apple management provided more perspective on the quarter and fielded questions from analysts on topics ranging from Apple Watch to the long-term growth potential for iPhone. Here are some of the most notable takeaways from the call.

Apple CEO Tim Cook. Image source: Apple.

There's more room for Apple's iPhone business to grow Can Apple's iPhone business continue to grow? After all, the company is likely to sell about 210 million iPhones this fiscal year. At what point will Apple's annual iPhone sales hit a ceiling?

According to Cook, there's still more upside left.

"I think everybody's going to own a smartphone, and I think we've proven that we can compete for a fair number of those, as you can see from our results," Cook said.

To back up his opinion, Cook cited IDC projections for global smartphone sales to grow 8.2% annually, reaching 1.9 billion in 2019. He also noted that only 27% of Apple's iPhone installed base prior to the launch of iPhone 6 and 6 Plus have upgraded, and that Apple is seeing the highest rate of Android users switching to Apple products it has ever observed.

Growth in emerging markets is impressive Despite the high price point for Apple's products, the company is doing incredibly well in its emerging markets, Cook explained during the call.

Cook also said Apple was seeing a large number of first-time iPhone buyers in Russia and Brazil.

Revenue in Apple's Greater China segment, which is its second-largest segment and lumps together China, Hong Kong, and Taiwan, was up a whopping 112%.

Overall, iPhone sales growth in all of Apple's emerging markets combined jumped 65%, year over year, Cook said.

Apple Watch is off to a good start While Apple Watch sales during Q3 likely didn't live up to analysts' expectations for sales of about 4 million units, this doesn't mean the new category isn't starting off well.

Cook provided some useful perspective.

"[T]o provide a bit more color, sales of the Watch did exceed our expectations and they did so despite supply still trailing demand at the end of the quarter."

The key point here is that supply was still trailing demand when the quarter closed, so it's too early to say Apple Watch sales have leveled off.

And Cook hinted there could be better quarters ahead for Apple Watch this year.

"[W]e're now planning to expand our channel before the holiday because we're convinced that the Watch is going to be one of the top gifts of the holiday season."

With meaningful evidence there's still more upside for Apple's business, and the Apple Watch off to a promising start, Apple shareholders can continue to rest soundly at night and hold this stock for the long haul.

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