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Apple shares jumped on Wednesday, putting the tech giant closer to becoming the first publicly traded company to reach a market value of $1 trillion.
The rally followed the company's quarterly report in which earnings and revenue came in better than expected, as iPhone sales climbed and revenue from services like the App Store hit a record high. The stock had already advanced more than 12% this year as of Tuesday's close.
Despite slow-growing demand for its flagship device, Apple has benefited from higher iPhone prices following the introduction of the range-topping iPhone X, which starts at $999. The average selling price of an iPhone came in at $724 in the company’s fiscal third quarter, more than Wall Street’s estimate of $694, according to FactSet data cited by Reuters.
Sales of the iPhone were up 20% compared to the same period last year, hitting $29.9 billion. Apple said iPhone shipments edged about 1% higher to 41.3 million units, slightly less than analysts expected.
Apple also booked stronger revenue from the App Store, iTunes and other services. The company said its services business – the second-largest contributor to the top line behind the iPhone – generated $9.55 billion in revenue, up 31% year-over-year.
Cupertino, California-based Apple said its fiscal third-quarter profit jumped 32% to $11.52 billion. On a per-share basis, earnings hit $2.34 to beat Wall Street’s estimate of $2.18.
Total revenue grew 17% to $53.27 billion, which also topped a consensus estimate of $52.34 billion.
Apple provided a forecast of $60 billion to $62 billion in fiscal fourth-quarter revenue. That guidance beat analysts’ current estimate of $59.6 billion.
Apple’s fourth quarter will benefit from early sales of new iPhone models. Analysts believe Apple will introduce at least three iPhones in the fall, including devices that target users looking for cheaper options. In a recent note to clients, CFRA analyst Angelo Zino said he expects Apple to launch a 6.1-inch LCD model with a starting price around $699.