Apple sales continue to lose ground
November 3, 2023 10:26 AM
Apple on Thursday reported that sales fell for the fourth consecutive quarter when compared to the prior year, but profit rose on the back iPhones and services.
The tech giant said it made a profit of $23 billion on revenue of $89.5 billion, which was down slightly from the same period last year.
Apple chief executive Tim Cook said iPhone sales set a new record for its September quarter while money taken in from services hit an all-time high.
The company brought in $43.8 billion from iPhone sales while its services unit selling products such as Apple Music and iCloud brought in $22.3 billion, up 16 percent from a year ago.
"We now have our strongest lineup of products ever heading into the holiday season, including the iPhone 15 lineup," Cook said in an earnings release.
The iPhone performance came as sales of smartphones continued to shrink globally in the recently-ended quarter as consumers watched spending, according to market tracker Counterpoint.
Smartphone sales fell 8 percent, marking the ninth consecutive quarter of decline in year-over-year comparisons, according to research by Counterpoint's Market Pulse service.
Apple's strong September sales along with buzz around the new iPhone 15 line-up were signs the current quarter may break the losing trend, according to the market tracker.
The company said that the supply of premium versions of the iPhone 15 would be constrained until the end of the year, putting a brake on sales.
"We're working very hard to get the product in the hands of all the customers that have ordered it," said Apple CFO Luca Maestri.
Cook said that Apple continued to face "an uneven macro-economic environment" in the quarter, including pressure from currency exchange rates.
"We've adapted continuously to circumstances beyond our control, while being thoughtful and deliberate on spending."
Sales of computers, tablets and connected accessories all fell year-on-year.
Apple's Macs suffered in particular with sales plummeting by half, to $7.6 billion for the quarter, though this was partly due to a post-covid sales burst a year ago.
"We have great confidence in our Mac lineup and are excited about the recently announced iMac and MacBook Pro, powered by our M3 chips," Maestri said.
The number of Mac users is at an all-time high, and half of the people buying models during the recently ended quarter were new to Apple's line of computers, according to Maestri.
Apple unveiled its latest iPhone lineup in September, with its Lightning charger ports replaced on the newest models by a universal charger after a tussle with the European Union.
- China factor -
The firm said sales in China slipped, but Cook added this was due to foreign exchange factors.
"Underneath that if you look at the different the categories, iPhone actually set a September quarter record in mainland China," he said.
Since the US tech giant first established a presence in China in 1993, Apple has grown into a major provider of smartphones, laptops and consumer electronics in the country.
During an earlier visit in March to Beijing, Cook said his company enjoyed a "symbiotic" relationship with China.
The country remains the company's main manufacturing hub, despite diplomatic turbulence between Washington and Beijing as well as talk of pivoting more production to India.
Apple shares fell more than 3 percent to $171 in after-market trades that followed release of the earnings figures.