Apple has sold fewer iPhones in the first quarter of 2017 compared to the number of sales in 2016 for the same period.
Apple, which is due to release a new phone later on this year, revealed that it has sold 50.8 million in the first quarter of the year – 1% less year on year.
The company’s CEO Tim Cook believes that the “pause” in sales is expected as people await the release of the new phone.
In the meantime, Apple’s shares dropped by 2% in the late hours of trading after it hit an all-time high on expectations of better results.
Earlier, Apple experienced an increase in revenue by 4.6% across its entire company, reporting revenues of $52.9billion.
The decline in sales was covered up by Apple’s services divisions – iCloud, Apple Pay and it’s App Store whose revenues spiked by 18%, making sales of $7billion.
Cook also pointed out the improved sales of the Apple Watch, Apple’s Airpods, and its Beats headphones.
For Apple, the post-Christmas time of the year is known for the crash in sales but such a drop has left investors dissatisfied since shares hit a record high on Tuesday in anticipation of strong earnings.
Tim Cook did try and draw attention to Apple’s Services Division as Apple Music, iTunes and Apple TV continue to grow – but Apple’s health is most accurately represented by the sales of its greatest contributor – its smartphones.
This year celebrates the 10th anniversary of the iPhone therefore there are a lot of expectations from this upcoming model. Customers and investors expect a significant improvement in the new phone – it can’t just be a simple upgrade of previous versions.
Reports from GlobalData found that the revenues from Apple’s iPhones have declined by a huge $7billion compared to the same period two years ago. The analysts at the firm believe that the iPhone line has matured and the lack of significant improvements in the newer versions has prevented Apple from recovering from the slump it experienced in the last fiscal year.
In addition, Apple faced a sufficient decline in sales in China last year as revenues from there sank by 14%, however, Tim Cook blames the drop on currency fluctuations.
To divert attention from the slow sales of its iPhones, Apple has said that its quarterly profit of $11 billion worldwide was higher by 4.9% of last year’s profits for the same period.
At the same time, the firm has promised to return a whopping $50 billion to its shareholders.