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NEW YORK: Apple reported solid profits on rising revenues Thursday, but the tech giant’s iPhone sales missed estimates as executives signaled a rising financial toll from the strong dollar.

Shares of Apple edged higher in after-hours trading, as the tech titan avoided a stumble akin to those experienced by Facebook parent Meta and Amazon, both of which have been punished by investors.

Profits edged up one percent to $20.7 billion, on an eight percent rise in revenues to $90.1 billion in Apple’s fiscal fourth quarter ending September 24.

Results for the latest quarter “continue to demonstrate our ability to execute effectively in spite of a challenging and volatile macroeconomic backdrop,” said Apple Chief Financial Officer Luca Maestri.

Apple notched growth in most operating regions and product categories and released an earnings statement that contained no obvious red flags and showed the company still able to notch broad-based revenue growth.

Still, Apple’s smartphone revenues came in at $42.6 billion, up about 10 percent from the year-ago period, but a bit below the $43 billion projected by analysts.

Apple is cutting back production of iPhone 14 Plus due to weak demand

The company also reported services revenue growth of just 5.0 percent compared with the year-ago period – much below the 12 percent jump in the prior quarter.

Some of the weakness in services stemmed from the impact of the strong dollar on overseas consumers, but executives also cited weakness in digital advertising and gaming, Maestri said.

While Apple avoided a specific forecast, Maestri cautioned analysts to expect revenue growth to “decelerate” in the fourth quarter, due in part to a foreign exchange hit of 10 percentage points.

Analysts described Apple’s results as respectable, but warned that the worsening consumer environment will pose challenges.

“Overall, we view the (September quarter) as a solid beat and see a good holiday selling season ahead, but do think conditions get more challenging as the iPhone 14 cycle extends given the uncertain economic conditions,” said CFRA Research analyst Angelo Zino.

“That said, we believe Apple’s prestige brand is allowing it to successfully increase prices to consumers across all devices and services.”

Heading into earnings season, investors had expressed worries about the headwinds from the weakening global economy as central banks enact aggressive interest rate hikes to counter grinding inflation.

This week’s tech results have shown that the sector, which enjoyed outsized growth during the peak period of Covid-19, is not immune to these factors.

Shares of Apple rose 0.7 percent to $145.87 in after-hours trading.

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