Apple’s iPhone sales fell 17 per cent in the first three months of the year as the company’s flagship product continued to struggle.
The tech company reported revenues of $31.05 billion (€27.68 billion) in iPhone revenues for the quarter, the majority of the $58 billion in revenues Apple brought in over the three months.
The news was less gloomy than expected and Apple’s shares spiked 4 per cent in after-hours trading as Apple announced it was buying back another $75 billion of its shares.
The company made a profit of $11.6 billion – ahead of expectations. But this quarter marked another quarterly decline in profit and revenue as the company struggled to move beyond the iPhone.
In January, Apple reported its first decline in revenues and profits in over a decade as slowing sales of iPhones and an economic slowdown in China took their toll.
Those results came after chief executive Tim Cook shocked investors by issuing Apple's first profits warning since 2002 citing "the magnitude of the economic deceleration, particularly in greater China".
Next generation
The company has stopped reporting unit sales of iPhones – leaving analysts searching other sources of data for their estimates. Most do not expect a recovery in sales until the next generation of phones, using the super-fast 5G network, are launched, likely to be in 2020.
In the meantime, Apple is repositioning itself as a services and software company, as well as a manufacturer of hardware.
"Investors are slowly shifting their focus away from the iPhone cycle and valuing the company more based on the ecosystem of hardware, software and services, but it will take several years for this to become consensus," Gene Munster, managing partner of Loup Ventures, wrote in a blog post this week.
Apple’s services segment, which includes products like Apple Pay, Apple Care and Apple Music, posted a record $11.5 billion after reporting a record $10.9 billion in the last quarter.
Last month Apple unveiled a host of new subscription services, Apple TV+, at a star-studded event attended by Oprah Winfrey, Steven Spielberg, Reese Witherspoon and Big Bird. It has also announced Apple Card, a credit card backed by Goldman Sachs and MasterCard.
“Our March quarter results show the continued strength of our installed base of over 1.4 billion active devices, as we set an all-time record for services, and the strong momentum of our wearables, home and accessories category, which set a new March quarter record,” said Tim Cook, Apple’s chief executive officer. – Guardian
