Apple Inc. isn’t the only company feeling the effects of a softening iPhone market. Target’s shares closed down 6.4% at $70.63. Despite the drop in sales, the retailer says it’s working with Apple to capitalize on new product launches during the second half of the year. What’s particularly interesting about Target’s earnings is that sales of electronics experienced a double-digit decline year over year.
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Target released its 2nd quarter results on Wednesday, including a 1.1% decline in revenue year-over-year. Apple this year famously experienced its first annual decline in iPhone sales in history. Apple doesn’t break out watch or headphone sales specifically, but third-party data suggested watch sales fell as much as 55%. In a conference call with analysts, executives cited a 20% decrease in sales of Apple products as one of the principle reasons for overall performance.
CEO Tim Cook has said that his company is working on new products, that the smartphone will continue to be integral to people’s lives for the near and midterm future, and that he believes in Apple’s future.
Cowell told investors and reporters that a lack of “newness” and “innovation” from Apple meant that consumers were not buying iPhones and iPads at the same rate as before.
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Cornell said Target is “actively addressing” the challenges, which includes “collaborating with Apple and other vendor partners” to evolve its electronics offerings. “We’re putting together plans with Apple and our merchandising teams to make sure we’re ready to take advantage of that in the back half of the year”.
