In this May 31, 2018, photo, a customer enters the Apple store in New York. Apple made more money from higher priced iPhones in the latest quarter, even as unit sales were relatively unchanged. Shares of Apple rose nearly 3 percent Tuesday, July 31, after it reported fiscal third-quarter results that beat Wall Street expectations. (AP Photo/Mark Lennihan)

Apple shares rise on jump in average price of iPhones

July 31, 2018 - 5:40 pm

Apple made more money from higher priced iPhones in the latest quarter, even as unit sales were relatively unchanged.

Shares of Apple rose nearly 3 percent Tuesday after it reported fiscal third-quarter results that beat Wall Street expectations.

Unit volume rose just 1 percent from a year ago to 41.3 million, which was expected, but the average selling price grew 20 percent to $724 per iPhone, up from $606 a year ago.

That suggests that more consumers were buying its premium iPhone X, which starts at $999. The iPhone X features a brighter screen that spans the device from edge to edge, and boasts facial recognition technology for unlocking the device and other features. But while that model costs a few hundred dollars more than previous iPhones, Apple's base models — the iPhone 8 and 8 Plus — also had $50 and $30 price increases compared with their predecessors.

Revenue from the app store, music subscriptions and other services grew 31 percent to $9.5 billion, a record for Apple. The figure included a one-time gain of $236 million in connection with resolving various lawsuits, which the company didn't specify. During the quarter, Apple settled a long-running patent battle with Samsung.

Apple also reported a 37 percent increase, to $3.7 billion, in the division for miscellaneous hardware, including Apple Watch and the HomePod smart speaker. But Apple saw revenue declines in both the iPad and Mac computers.

Cupertino, California-based Apple said net income rose 32 percent to $11.52 billion, or $2.34 per share.

That beat the $2.17 per share expected by 10 analysts surveyed by Zacks Investment Research.

The maker of iPhones, iPads and other products posted revenue of $53.27 billion, up 17 percent, also exceeding Street forecasts for revenue of $52.37 billion.

For the current quarter ending in September, Apple said it expects revenue of $60 billion to $62 billion. Analysts surveyed by Zacks had expected revenue of $58.59 billion.

Apple shares have climbed 12 percent since the beginning of the year, while the Standard & Poor's 500 index has climbed slightly more than 5 percent. In the final minutes of trading on Tuesday, shares hit $190.29, a climb of 28 percent in the past 12 months.

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Parts of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on AAPL at https://www.zacks.com/ap/AAPL

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