Apple's Forecast Suggests Phone Sales Stabilized
Apple projected quarterly sales that suggest demand for iPhones has stabilized after a disappointing holiday period.
Sales of iPhones, which account for more than half of all revenue, fell 17% in the fiscal second quarter from a year earlier and slightly missed analyst expectations.
After Apple slashed prices in China, iPhone sales picked up toward the end of the quarter and revenue rose from iPads, wearables and services. While consumers may be putting off phone purchases longer than in the past, they are deepening ties with the company’s brand.
Apple said it expects revenue between $52.5 billion and $54.5 billion for the current quarter ending in June.
Apple Chief Executive Tim Cook said that iPhone sales started to strengthen during the last few weeks of the fiscal second quarter, including in China.
Apple reported net earnings per share of $2.46 for the March quarter, down about 9.9% from a year earlier. Actual net income declined 16.3% to $11.56 billion.
Apple didn’t say how many iPhones, iPads, or Macs it sold. However, the company broke down revenue for its main product segments:
- iPad: $4.87 billion, up 22 percent year-over-year
- Mac: $5.51 billion, down 5 percent year-over-year
- Wearables, Home, and Accessories: $5.13 billion, up 30 percent year-over-year
Services revenue, which includes sales from iCloud, the App Store and other businesses, reached $11.45 billion.
Investors are looking to Apple’s services business to fuel growth as iPhone sales slow. Last month, Apple revealed a new credit card offering and subscription services for news, television and gaming, though only the news subscription is currently available to purchase.
Apple said it has 390 million total subscribers to both its own and third-party services on its devices. The company has set a goal of 500 million by 2020.