Apple hails 'extraordinary' iPhone demand as boss Tim Cook heads out

Apple has seen demand for its iPhone reach new heights with sales growth in China outpacing all other regions.

Overall, sales of Apple products grew 17% to $111bn (£81bn) in the first three months of the year, compared to the same quarter a year ago, the company said in financial results released Thursday. Sales in China were up by 28% compared to a year ago.

Tim Cook, Apple's outgoing chief executive, said that recent demand for the iPhone had been "extraordinary", making the iPhone 17 the "most popular launch in [Apple's] history."

Despite continued iPhone success, sales of Apple's other products, including the Mac computer and wearable devices like the Apple Watch, remained relatively flat.

However, Cook told financial analysts on a call to discuss the company's performance that the new Macbook Neo was seeing "off the charts" demand. He said the quarter set a record for new Mac buyers thanks to the Neo, which is sold at a significantly lower price than other Mac laptop computers.

Beyond current products, Cook said Apple Intelligence, the company's artificial intelligence (AI) product, will be updated later this year, and included as part of its Siri voice-assistant.

"This is not AI as a standalone feature, but AI as an essential and intuitive part of our devices," Cook said. He added that Apple's angle on AI is to be "respectful of user privacy", something that he said made it clear why Apple platforms were "the best places to experience AI".

Apple's rollout of AI features has set it apart from the broader technology industry.

Instead of pouring hundreds of billions of dollars into a race to build its own AI model, the company has chosen to partner with companies like OpenAI and Google to weave in their AI technology to power some Apple features.

While some have criticised Apple as a late-mover on this wave of AI technology, the company is far less exposed to potential losses if the huge expectations of AI are not realised.

Given Cook's imminent move from chief executive to chairman role, he took a moment to praise John Ternus, the longtime Apple hardware executive who will become the next Apple boss on 1 Sept.

"I know he will push us to go further than we think is possible in order to deliver products for our users," Cook said.

Ternus spoke briefly for the first time to financial analysts on the call, saying that he plans to keep up Cook's habit of financial "discipline" and alluded to future product roll-outs.

"We have an incredible roadmap ahead…suffice it to say this is the most exciting time in my career at Apple to be building products and services," Ternus said.

Reddit also published its quarterly results on Thursday.

The platform, which hosts online forums and topical chat groups, said its revenue hit $663bn for the quarter, a jump of 69%.

During a call with financial analysts, Reddit's chief executive Ladd Huffman, noted that 200 million people in the US, more than half of the country's population, visits Reddit every week.

The goal, however, is to get that many people in the US visiting the site every day. Reddit also aims to see one billion people around the world on the site each day.

"So [daily active users] is both our mission and also fuel for the business," Huffman said.

Reddit has also become a key source of training data for AI companies that "scrape" or harvest material from internet pages so that the data can help train AI chatbots and tools.

Huffman said Reddit's current deals with OpenAI and Google, charging them to use conversations on Reddit for their AI models, is valuable. But he said venues like Reddit, where people converse on a range of topics would become even more important, the more the rest of the internet became "optimised for AI".

"At the end of the day, there is no artificial intelligence without actual intelligence," Huffman said.

Roblox, the online gaming platform popular with young people, saw its shares fall 20% in after hours stock trading following its quarterly results.

The company said that its user base and revenue grew significantly over the last three months.

However, in a letter to investors, chief executive David Baszucki, noted that user growth was not as high as expected after Roblox implemented stricter checks of user age on the platform.

"We believe growth was tempered by greater-than-expected headwinds from our age-check roll out, which restricted on-platform communication for non-age checked users, diluted communication for age-checked users, and slowed new user acquisition," Baszucki said.

Investors also reacted poorly to the company saying it expected to make less money this year than it initially planned.

Roblox has yet to notch a profitable quarter, despite being a publicly traded company since 2021.