{"id":74942,"date":"2016-04-27T02:50:12","date_gmt":"2016-04-27T06:50:12","guid":{"rendered":"https:\/\/canadianinquirer.net\/v1\/?p=74942"},"modified":"2016-04-27T02:50:12","modified_gmt":"2016-04-27T06:50:12","slug":"apple-reports-iphone-sales-1st-revenue-drop-since-2003","status":"publish","type":"post","link":"https:\/\/canadianinquirer.net\/v1\/2016\/04\/27\/apple-reports-iphone-sales-1st-revenue-drop-since-2003\/","title":{"rendered":"Apple reports iPhone sales down, 1st revenue drop since 2003"},"content":{"rendered":"
\"Tech<\/a>
Tech company giant Apple (ShutterStock image)<\/figcaption><\/figure>\n

SAN FRANCISCO \u2013 Apple sold more than 51 million iPhones in the first three months of this year \u2013 and that\u2019s the problem.<\/p>\n

That\u2019s 10 million fewer iPhones than the tech giant sold during the same quarter a year ago. As a result, Apple on Tuesday reported its first drop in quarterly revenue in 13 years \u2013 and the first-ever year-over-year decline in iPhone sales.<\/p>\n

The slide is putting more pressure on Apple and CEO Tim Cook to come up with its next big product.<\/p>\n

Cook, of course, has problems many corporate bosses would kill to have. Despite the decline in sales, Apple managed to rack up $10.5 billion in profit for the quarter.<\/p>\n

\u201cThe future of Apple is very bright,\u201d Cook told analysts on a conference call Tuesday.<\/p>\n

But Apple is battling perceptions that its latest iPhones aren\u2019t that different from previous models, at a time when overall smartphone sales are slowing around the world. Apple also sells iPads, Mac computers and other gadgets, but nearly two-thirds of its $50.6 billion in quarterly revenue came from iPhones.<\/p>\n

\u201cThey need to come out with that next great product,\u201d said Angelo Zino, a financial analyst with S&P Global Market Intelligence. Zino said that while he is optimistic about the company\u2019s future, \u201cApple absolutely needs to start diversifying their revenue base.\u201d<\/p>\n

Overall, the company\u2019s revenue in the January-March quarter was down 13 percent from a year earlier. And the company surprised analysts by forecasting another revenue drop of 13 percent or more in the current quarter.<\/p>\n

The forecast, which was announced after Apple had closed for the day at $104.35 a share, drove its stock price down 8 percent in extended trading.<\/p>\n

Apple hasn\u2019t reported a year-over-year sales decline since 2003, when the iPod was still relatively new and the iPhone didn\u2019t exist. Since then, the iPhone and other products have propelled the company\u2019s stock value from $5 billion to $579 billion, making it the most valuable public company in the world.<\/p>\n

Despite the quarterly decline, Chief Financial Officer Luca Maestri defended the iPhone business in an interview with The Associated Press.<\/p>\n

\u201cWe think we can continue to bring a lot of innovation to the market,\u201d he said of future models, while adding that Apple is working to expand other lines of business.<\/p>\n

Apple\u2019s revenue for the quarter included $6 billion from online services, apps and other software, he noted. That\u2019s up 20 percent from a year earlier. Analysts agree the figure could rise further, given that there are more than 500 million iPhones in use.<\/p>\n

Many were hoping the Apple Watch would be the company\u2019s next big hit when it went on sale a year ago. Apple hasn\u2019t revealed sales figures for the watch, but most analysts estimate the company has sold 12 million or more, producing well over $5 billion in revenue. That\u2019s more than twice the number of iPhones sold in the first year after the product\u2019s introduction in 2007.<\/p>\n

While some owners say they\u2019re delighted with the Apple Watch, others have voiced disappointment that it doesn\u2019t do more. And critics say it hasn\u2019t ignited consumer passions in the way the iPhone became a must-have product.<\/p>\n

Apple said iPad and Mac sales both fell in the quarter. Meanwhile, the company is also widely believed to be working on other new products, such as virtual reality headsets and even electric cars.<\/p>\n

But Apple hasn\u2019t officially confirmed any plans, and Cook recently signaled that a car isn\u2019t coming soon.<\/p>\n

\u201cDo you remember when you were a kid and Christmas Eve, it was so exciting \u2013 you weren\u2019t sure what was going to be downstairs? Well, it\u2019s going to be Christmas Eve for a while,\u201d he cautioned when asked about an Apple car in February.<\/p>\n

Analysts are expecting Apple\u2019s performance to improve in the fall, when it\u2019s expected to release the next generation of iPhones with as-yet undisclosed new features.<\/p>\n

For now, Apple is finding it difficult to match the blockbuster sales it racked up last year, when shoppers flocked to buy the first iPhones with larger screens \u2013 similar to the 5- and 6-inch models that Samsung and other competitors were already selling.<\/p>\n

\u201cI think what we\u2019re seeing here is those tough comparisons\u201d to last year\u2019s sales figures, Zino said. \u201cWe\u2019re also seeing a lot of consumers holding onto their old phones, until the iPhone 7 launch this fall.\u201d<\/p>\n

Colin Gillis, an investment analyst with BGC Financial, said smartphone sales are likely to level off rather than grow. As with PCs and tablets in recent years, he said, it\u2019s becoming more difficult for manufacturers to come up with dramatic improvements that get shoppers excited.<\/p>\n","protected":false},"excerpt":{"rendered":"

SAN FRANCISCO \u2013 Apple sold more than 51 million iPhones in the first three months of this year \u2013 and …<\/p>\n","protected":false},"author":33,"featured_media":34738,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1482,19],"tags":[1605,4529,10457],"class_list":["post-74942","post","type-post","status-publish","format-standard","has-post-thumbnail","category-breaking","category-business","tag-apple","tag-iphone","tag-tim-cook","mauthors-brandon-bailey","mauthors-the-associated-press"],"_links":{"self":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/74942","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/users\/33"}],"replies":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/comments?post=74942"}],"version-history":[{"count":0,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/74942\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media\/34738"}],"wp:attachment":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media?parent=74942"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/categories?post=74942"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/tags?post=74942"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}