USA tech giant Apple posted its first drop in quarterly revenue in 13 years and its decline in iPhone sales for the first time in history.
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The company sold 51.2 million units, which was above the analyst expectation of 50 million devices.
Apple on Tuesday announced financial results for its fiscal 2016 second quarter. Even though the company sold 51.2 million units in Q2, beating the 50.7 million estimated units sold, it still did not match the Q2 2015 results, which was a record-breaking quarter with 61.2 million units sold.
Apple CEO Tim Cook said the company is placing higher emphasis on emerging markets such as India where it expects “disproportionate growth” versus the more developed areas.
In anticipation of the declining sales of the high-end iPhones last quarter, in March, Apple released its most awaited 4-inch iPhone SE.
We’ve watched the decline in iPad sales quarter after quarter – 19 percent this time – but iPhone? While these are not typically numbers that point to a struggling company, Apple share prices (NASDAQ:AAPL) lost over 5 percent, dropping below $100 on the Wednesday after the call.
iPhone sales were down year-over-year for the first time since the product’s launch in 2007. According to market research firm Strategy Analytics, at least 70% of the smartphones sold this year are estimated to be priced at US$400 or less.
CEO Tim Cook explained, saying “We’re thrilled with the response that we’ve seen on it”.
He explained that the year-on-year dip in iPhone shipments was due mainly to the exceptionally strong reception of the iPhone 6, which was unveiled in late 2014 and was the first big-screen iPhone.
Keeping up with the new trends, products like Apple Watch, Apple TV, iPod, Beats headphones, accessories, and all other hardware which come under the “Other Products” category grew nearly 30 percent from $1.69 billion to $2.19 billion.
Dawson said Apple managed to boost sales in a slow-growing market with its large-screen models, but that it is unclear if it can regain momentum.
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The company reported operating cash flow of 11.6 billion dollars and chose to return 10 billion dollars to shareholders through its capital return program.
