By Kevin Kelleher
November 1, 2018

Tech companies can be tight-fisted with the metrics that investors can use to gauge financial health, but Apple has long been an exception—until now. During its earnings call Thursday, Apple CFO Luca Maestri revealed the surprise news that Apple would no longer report unit sales on core products like the iPhone, iPad, and Mac computers.

“As demonstrated by our financial performance in recent years, the number of units sold in any 90-day period is not necessarily representative of the underlying strength of our business,” Maestri said.

Asked about the change in disclosure, Apple CEO Tim Cook drew the curious analogy of a shopper pushing a cart up to a cashier and being asked how many items are in the cart. “It doesn’t matter a lot how many units are in there in terms of the overall value of what’s in the cart,” he said.

Apple has not only been trying to offset slower unit sales by raising prices on its newer models, it’s been engineering a shift away from purely hardware sales to services revenue, such as revenue from Apple Music and its App Store. Apple reported services revenue of $10 billion last quarter, or about one sixth of its total revenue.

Analysts and investors have tracked Apple’s unit sales as a metric of demand, and also to extrapolate the average selling price of each product. That can give an indication of whether Apple is seeing stronger demand in newer models than in older, lower-priced ones.

For example, in its most recent quarter, Apple’s iPhone saw shipments of 46.9 million units. That was below Wall Street’s forecast of 47.5 million. But because demand for Apple’s newer, more expensive iPhones was high, iPhone revenue came in at $37.2 billion, above the consensus forecast of $35.6 billion. The average price of iPhones sold was $793.

Apple also said it shipped 9.7 million iPads, below the analyst forecast of 10.5 million units. Mac shipments, meanwhile, totaled 5.3 million units, above the forecast of 4.9 million.

Apple’s decision to make its sales data less transparent comes at an awkward time, since the number of iPhones sold not only came in below estimates, it marked only a 0.5% increase in iPhone unit sales from a year ago. Apple also warned about slow sales in the coming quarter. Reducing transparency in the face of a disappointing outlook makes it look like Apple wants to hide unflattering data.

Apple’s stock fell as much as 7.5% in after-hours trading Thursday after the company warned of slower-than-expected holiday sales. The decline briefly pulled the company’s market cap below the $1 trillion level.

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