Apple Reports Decline in Sales Across Multiple Countries
Apple’s latest results reveal a decline in sales across nearly all global markets, with smartphone demand dropping by over 10% in the first quarter of this year. Overall sales decreased in every region except Europe, leading to a 4% decline in revenues to $90.8 billion, the most significant drop in over a year. Despite the downturn, the results exceeded expectations, prompting Apple’s share price to rise in after-hours trading.
The company attributed the decline to Covid-related supply disruptions, which had led to unusually strong sales during the same period last year. Apple anticipates a return to growth in the coming months, citing upcoming product launches and investments in artificial intelligence.
In the critical Greater China market, overall sales fell by 8%, although iPhone sales in mainland China actually increased. CEO Tim Cook expressed optimism about China’s long-term prospects despite increasing competition from local rivals like Huawei.
Analysts noted that while companies such as Huawei may perform well domestically, the iPhone maintains an advantage globally in terms of features, functionality, and prestige.
However, Apple’s struggles contrast with the broader market, which saw a 10% increase in smartphone shipments in the first quarter, according to research firm Canalys. Analysts attribute Apple’s challenges to a lack of significant improvements in its handset since the launch of the iPhone 12 almost four years ago.
The company is also facing legal challenges, including anti-monopoly lawsuits in the US and Europe over its app store fees. Additionally, a separate lawsuit against Google threatens Apple’s revenue from payments received for making Google the default search engine on its Safari browser.
Despite these challenges, Apple reported flat pre-tax profit at $28 billion for the quarter and announced a $110 billion share buyback plan. Finance chief Luca Maestri expects sales to increase in the “low single digits” in the next quarter, with double-digit growth projected in the services business.
Analysts remain cautiously optimistic, noting that China is performing better than expected, and upcoming events and catalysts could improve investor sentiment.
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