Image source, Getty Images
- Author, Natalie Sherman
- Role, BBC News
-
iPhone sales have fallen in almost every market around the world, according to Apple’s latest results.
The tech giant said overall demand for its smartphones fell more than 10% in the first three months of this year, with sales declining in every geography except Europe.
Apple said that overall company revenue fell 4% to $90.8 billion (£72.5 billion), the biggest drop in more than a year .
Nevertheless, the results were not as bad as expected and Apple’s stock price rose after hours in New York.
The company said the figures were skewed by Covid-related supply disruptions, which led to unusually strong sales during the same period last year.
He pledged that sales would return to growth in the coming months, noting upcoming product launches and investments in artificial intelligence (AI).
For the iPhone, sales in the critical Greater China market fell 8%. Mr Cook sought to reassure investors about the state of affairs in the world’s second-largest economy, pointing out that iPhone sales were actually increasing in “mainland” China.
“I have a positive view of China in the long term,” he said.
Competition in this market has intensified from local competitors such as Huawei.
Gil Luria, senior software analyst at DA Davidson, said companies such as Huawei do well in China because “it’s a local brand.”
“But in terms of features, functionality and prestige, the iPhone still has an advantage over any other device,” he told the BBC’s Today programme.
“So whenever consumers have a choice and have the resources, they buy an iPhone – it’s no different in China.”
The company’s struggles – which have suffered a series of sales declines in five of the last six quarters – have marked a contrast with the broader market.
Globally, smartphone shipments rose 10% in the first three months of the year, up after a long sluggish period, according to research firm Canalys.
Mr. Luria said that for Apple, there have been no “significant improvements to the handset” since the iPhone 15 launched almost four years ago “when Apple introduced 5G connectivity, which has forced many consumers to upgrade the phone.
He added: “What they hope now is to be able to introduce enough new AI features into the iPhone 16, which will be released later this year, so that they can finally launch a big upgrade cycle of the Iphone.”
Apple also faces legal battles with regulators in the United States and Europe over its app store fees.
Another U.S. anti-monopoly lawsuit against Google threatens the lucrative payments Apple receives from the search giant in exchange for making Google the default search engine on Safari, Apple’s Internet browser.
According to court documents, those payments amounted to about $20 billion in 2022, a sum that helped boost Apple’s profits.
Pre-tax profit for the three months was flat at $28 billion and the company said it was setting aside $110 billion to repurchase shares.
Chief Financial Officer Luca Maestri said Apple’s sales were expected to grow in the “single digits” range in the three months to June.
He added that the company expects double-digit growth in its services business, offering more consulting than the company usually provides.
Looking ahead, Angelo Zino, senior equity analyst at CFRA Research, said: “China is holding up better than expected and there are a host of upcoming events/catalysts on the horizon that could improve investor confidence. “
News Source : www.bbc.com
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