Apple is predicting revenues of $50-53bn, below its Q2 2015 revenues of $58bn – the first year-on-year drop in revenues recorded by the company for 13 years.
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The launch of the iPad Pro helped Apple reporting 63 percent growth from the last quarter.
Explaining how the firm reached the milestone Cook said, “the growth of our Services business accelerated during the quarter to produce record results, and our installed base recently crossed a major milestone of one billion active devices”. Worldwide sales accounted for 66 per cent of the quarter’s revenue, Apple said.
The rub, however, is that jittery investors, pounded by a wobbly market and squishy global IT spending forecasts, are anxious how iPhone 6S and 6S Plus sales will hold up in the first half of 2016.
Apple got a boost last quarter from an earlier release in China of the latest iPhone models – the 6S and 6S Plus – but the trade-off is that sales in the current period may take a hit. Facebook had $4.5 billion in revenue its most recent quarter.
Apple Inc (AAPL.O) sold fewer iPhones than expected in the latest quarter, seeing its slowest ever-growth in shipments, as the company began to feel the effects of economic softness in the critical Chinese market.
Apple has announced its earnings report for the first quarter of 2016, and it’s an outcome that goes in two directions.
iPhone sales peak each year in the holiday season, and they were flat in the last quarter of 2015 relative to the same period a year prior.
“Apple is just the tip of a very large iceberg companies with multinational operations [that] can really do all sorts of things to minimise their tax”, Independent Senator Nick Xenophon said. Greater China brought in $18.37 billion in revenue, while Japan brought in $4.79 billion. The slowdown comes as Wall Street analysts worry that the company does not have another blockbuster product to replace the iPhone.
The results step up pressure on the company to pack its next iPhone update with new features that will prompt customers to upgrade.
Profitability will suffer, too: Apple projected its gross margin, the portion of revenue after production costs, would be between 39% and 39.5%, compared with consensus estimates of 39.97%. Net income and revenue were only two percent better than past year.
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Apple’s “Other Products” category, which includes the Apple Watch, saw revenue jump 26 per cent year-on-year to $6.056 billion (£4.23 billion), although unit sales were again not revealed. Following the forecast, the shares of the company have fallen over 5 per cent this year.
