Apple Reports Jump In Mac Sales Even As Some Macs 'Wither On The Vine'

The holiday quarter was kind to Apple, including in the company's Mac product line.

The Cupertino, Calif.-based company reported Tuesday that its fiscal first-quarter, ended Dec. 31, returned the company to sales growth after three quarters in a row of declining revenue.

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Helping the cause in fiscal Q1 were Mac sales, which rose to record quarterly revenue of $7.24 billion, up 7.4 percent from the same period a year earlier. That's compared to $6.75 billion in the year-ago quarter.

The uptick in Mac sales came during a quarter when Apple released an overhauled version of the MacBook Pro, the first major refresh to the laptop in four years.

The new MacBook Pro did receive a fair amount of criticism, though, including for only coming with USB-C ports and having a significantly higher price than previous generations of the laptop.

But one Apple partner, who reports having spent a large amount of time working with the new MacBook Pro, said Apple "certainly did put a lot of engineering time" into the laptop.

"It may not be all of the things people wanted to see," said Jerry Zigmont, owner of MacWorks LLC, an Apple consultant based in Madison, Conn. "But if you take it strictly from a technology standpoint, it's still a very strong indication that Apple's taking the MacBook Pro seriously."

During the company’s earnings call Tuesday, CEO Tim Cook said Apple surveys showed that many Mac customers during the quarter were buying a Mac for the first time and were "coming from a Windows PC."

For its fiscal 2017 first quarter, Apple reported sales of $78.40 billion, up 3.2 percent from revenue of $75.90 billion in the same quarter a year earlier.

Apple’s net income for the fiscal first quarter was $17.89 billion, down 2.6 percent from $18.36 billion in the year-ago quarter. Earnings per share were $3.36 in the quarter, compared with $3.28 a year earlier.

The growth in Mac sales doesn't necessarily suggest that Apple will be refreshing all of the products in its Mac line, however.

While Cook has singled out the iMac among the desktops that Apple is most focused on – and rumors point to the debut of an iMac refresh in the spring – the Mac Pro and Mac Mini have each gone years without a refresh.

"I'm not surprised if they wither on the vine and just go away," Zigmont said of the Mac Pro and Mac Mini. "As big as [Apple is], they only have so many resources. As some of the product lines get bigger and bigger, they're focusing less on the smaller product lines."

The Mac Mini and Mac Pro are "still niche markets," Zigmont said. "And if Apple's going for low-hanging fruit, where they know their bread is buttered, it's in the portable line and iMac."

Sales of iPhone rose 5.3 percent to $54.38 billion during the fiscal first quarter – driven in part by particularly strong sales of iPhone 7 Plus, Cook said during the earnings call.

But iPad sales declined during the quarter, dropping 28 percent on a year-over-year basis to $5.53 billion.

As for Apple's push to sell more products to businesses, Cook contended during the earnings call that Apple is "making great progress in the enterprise market," including with partners Cisco, IBM and SAP. The total number of joint customer opportunities with Cisco, for instance, grew by more than 70 percent during the recent quarter, Cook said.

As for the possibility of repatriating corporate profits that are held overseas, at a tax rate that's lower than the current 35-percent rate, Cook said during the call that such a move by the federal government would be "very good for the country, and good for Apple."