Apple's Services revenue growth decelerated sharply in the fiscal third quarter, and CFO Kevan Parekh attributed part of the slowdown to the absence of a blockbuster F1 movie release this year. Services revenue came in at $30.7 billion, up 12% year-over-year and a June-quarter record, but that marked a deceleration from 16% growth in the prior quarter. Parekh said last year's quarter included the theatrical release of F1, one of the highest-grossing sports films in history, which boosted Apple TV+ revenue, while this year had no comparable release. He also cited foreign exchange headwinds and softness in mobile gaming as factors weighing on performance. Despite the slowdown, Apple posted June-quarter records across advertising, AppleCare, Apple Music, video, and the App Store, and surpassed 1.5 billion paid subscriptions. Parekh warned that Services growth is expected to slow further in the September quarter, with currency effects alone reducing the year-over-year growth rate by another 2.5 percentage points sequentially. The earnings call also marked Tim Cook's final one as CEO, with Cook confirming that John Ternus will lead future calls and become CEO on September 1, while Cook moves to executive chairman.
Apple Inc.Services growth decelerated due to missing F1 movie release and softness in mobile gaming.