Apple’s market cap closes at $3 TRILLION for the first time since August after its shares climbed 2%

Apple's market valuation closed above $3 trillion on Tuesday for the first time since August, demonstrating the company's sustainability despite poor holiday sales forecasts.

The iPhone maker's shares rose two percent to $193.42 per share, bringing its market capitalization to 3.01 trillion.

Apple became the first company to reach a market value of $3 trillion in June and stayed there until August, when the tech giant warned it was heading for a fourth straight quarter of declining sales.

The company's stock price has risen this year even as the company bought back $76.6 billion worth of shares through a buyback program it announced in May.

In Securities and Exchange Commission filings for the fiscal year ended September 30, Apple said 2023 net sales were $383.3 billion and net income was $97 billion.

Reported iPhone sales rose 2.8 percent, contributing to total revenue of $89.50 billion, including nearly $1 billion more in services revenue than Wall Street expected.

But the results don't include the majority of sales from Apple's latest iPhone 15 models, and the company expects sales for the holiday quarter to be roughly in line with last year.

Chief Financial Officer Luca Maestri said sales for the current quarter, when Apple typically sees the largest sales of new iPhone models, will be similar to the previous year.

Wall Street expected revenue to rise 4.97 percent to $122.98 billion.

Apple is facing potential headwinds after the United States International Trade Commission issued an order last month that would ban U.S. imports of certain Apple Watches over alleged patent infringement.

The order would take effect on December 26 unless it is overturned on appeal or Apple strikes a deal with the patent holder to avoid enforcement.

The Cupertino, California-based company is also facing an uneven economic recovery in China, a key market for Apple.

Last quarter, sales from China fell 2.5 percent, and CEO Tim Cook said the company's new high-end handset models – the iPhone 15 Pro and Pro Max – are facing supply constraints.

“While we believe investors should breathe a sigh of relief as both revenue and profit exceeded expectations, the upside was small and we were concerned about weak sales from China,” said DA Davidson analyst Tom Forte.

Apple is facing stiffer competition in the smartphone market this year as Huawei Technologies returns to the field with new phones powered by Chinese chips after years of being virtually shut out of the market by US government trade restrictions.

Apple's sales in China fell to $15.08 billion from $15.47 billion in the fourth quarter a year ago.

CEO Cook said that after taking into account exchange rates, Apple's business in China grew year on year, driven by revenue from iPhone sales and services.

“In mainland China, we set a quarterly record for iPhone for the September quarter,” Cook told Reuters. “We had four of the five best-selling smartphones in urban China.”

Cook said Apple was “working hard to produce more” iPhone 15 Pro and Pro Max devices. “We believe we will reach a balance between supply and demand later this quarter,” he said.

Several global trends are also playing in Apple's favor, with forecasters predicting that the smartphone market has bottomed out and could start to recover in 2024.

Longer term, investors are watching to see how Apple responds to the boom in generative artificial intelligence, where systems can follow directions in a human-like manner – an area that has attracted billions in spending from Microsoft and Alphabet's Google.