Apple reported the slowest sales ever of its market-leading iPhone, after years of rocketing growth, but the tech giant still posted record quarterly profit. Apple also predicted revenue for the second quarter of 2016, which is expected to be between $50 and $53 billion, down from $58 billion in revenue from the same period in 2015.
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Apple posted $18.4 billion in earnings with revenue of $75.9 billion, which beat the $18.22 billion profit projections by analysts but fell short of the revenue projection of $76.67 billion. The projection came after a holiday quarter in which net sales and iPhone shipments missed estimates, reinforcing concerns that a push in China won’t offset a decline in the rest of the world.
Apple CEO Tim Cook confirmed during the company’s financial earnings conference call today that iPhone sales will likely decline in the March quarter, marking the first year-over-year decline since the smartphone was released in June 2007. He added, “The growth of our services business accelerated during the quarter to produce record results”.
The slowdown is largely in line with expectations that sales of iPhones had peaked and Apple needs to find a new source of growth. But the revenue from the iPad sales dropped 21 percent to $7 million.
It saw its biggest growth in Greater China, with revenue jumping 14 per cent year-on-year and by nearly half (47 per cent) from the previous quarter to $18.373 billion (£12.85 billion).
But sales growth for the smartphone maker appears to have plateaued, and iPhone unit sales are expected to fall for the first time during the current quarter.
Partly as a result, Apple generated almost $6 billion in revenue from services, including its App Store, iTunes, Apple Music subscriptions, Apple Pay.
Cook also told media about the hope for the company.
“We don’t live in 90-day quarters, and we don’t invest in 90-day quarters”, said Cook.
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Apple sold 5.3 million Mac devices in the quarter, decrease four percent year-over-year and seven percent quarter-over-quarter.
