Two of the Silicon Valley’s biggest heavyweights, Apple Inc. (NASDAQ:AAPL) and Facebook Inc (NASDAQ:FB) reported their January-March quarter results on Wednesday after the market close. And each of them impressed the markets in their own ways. Both technology giants knocked out the Wall Street estimates by a healthy margin. Apple shares soared as much as 7.29% to $563.02, while Facebook jumped 4.71% to $64.25 in pre-market trading Thursday.
Apple tries to woo investors
Apple Inc. (NASDAQ:AAPL) reported better than expected Q2 results, thanks to solid iPhone sales worldwide. However, the company tried to please investors with an increased dividend, a stock split, and share buybacks. Investors have been concerned about Apple’s slowing growth after a decade. The iPhone maker reported revenues of $45.65 billion and earnings of $11.62 a share. Analysts polled by Thomson Reuters were expecting $43.5 billion in sales and $10.18 a share in earnings.
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Apple Inc. (NASDAQ:AAPL) sold a whopping 43.7 million iPhones during the quarter, beating the Wall Street consensus of 38 million units. The tech giant increased its share repurchase authorization from $60 billion to $90 billion. What’s more, Apple has increased its dividend by 8% to $3.29. Tim Cook announced in a conference call that the company has approved a 7-for-1 stock split. The split will bring down Apple’s stock price to around $75, making it more affordable for investors.
Solid iPhone sales helped Apple Inc. (NASDAQ:AAPL) increase its gross margin to 39.3%, compared to the Wall Street consensus of 37%-38%. The Cupertino-based company also promised to launch more new products and services this year that “only Apple can bring.” However, not everything was shiny. The iPad sales tanked 16% to 16.4 million units. Analysts were expecting the company to sell close to 20 million iPad units during the quarter.
Facebook crushes estimates on every important metric
On the other hand, Facebook Inc (NASDAQ:FB) beat the consensus estimates and met even the most bullish forecasts. The social networking giant’s first quarter revenue soared 72% YoY to $2.5 billion, compared to the consensus estimate of $2.36 billion. Its non-GAAP operating income jumped to $1.37 billion. Facebook reported adjusted EPS of $0.34, well above Citi Research’s estimate of $0.23.
Facebook Inc (NASDAQ:FB) said mobile ad revenue came at $1.34 billion. Mobile advertising now accounts for 59% of its total ad revenue, up from 30% in the corresponding quarter last year. As of March 31, the world’s largest social network has 1.28 billion monthly active users. Meanwhile, WhatsApp has also surpassed 500 million user base. User engagement has also showed signs of improvement. The company said 62.7% of its active users access the site every day, up from 59.9% in the same quarter last year.
Facebook CFO will go back to the healthcare industry
However, Facebook Inc (NASDAQ:FB) chief financial officer David Ebersman said Wednesday that he will leave the social networking giant to return to the healthcare industry. Ebersman will remain with the social networking giant through September. He joined Facebook in 2009. The Menlo Park-based company said David Ebersman will be replaced by David Wehner, VP of corporate finance and business planning.