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Having declined for the first time ever in the first quarter of the year, Apple’s smartphone has repeated the feat in the company’s following quarter.
40.4m iPhone were sold in Apple’s Q3, down 15 per cent, although this was slightly ahead of some expectations. The company expects another decline in Q4.
Comparisons were further dented by a strong corresponding quarter in the previous year. iPad sales, which have been on a downward trend for some time, fell by nine per cent.
As a result profits for the period were down 27 per cent year-on-year to $7.8bn with revenues slipping 14.6 per cent to $42.4bn. Perhaps most worrying was the 33 per cent drop ion Apple sales in China, which is an area where most tech companies are targeting growth.
On the plus side, Apple’s digital services business climbed 18.9 per cent year-on-year, making it Apple’s second most profitable division behind iPhone.
We are pleased to report third quarter results that reflect stronger customer demand and business performance than we anticipated at the start of the quarter,” Apple CEO Tim Cook said. We had a very successful launch of iPhone SE and we’re thrilled by customers’ and developers’ response to software and services we previewed at WWDC in June.”
The general consensus is that Apple is suffering due to consumers’ willingness to hang on to their handsets for longer. Why this is a trend is more hotly debated. Certainly the slowing pace of change and less perceivable evolution from iPhone to iPhone does not help, but on a more general basis the rapid growth of the smartphone sector has led to greater uniformity of technology and fewer opportunities for ‘killer features’.
Apple will unveil the iPhone 7 in September.
