Just a year ago, Apple was the first company to reach the trillion dollar mark. However, fast forward to nine months, the company is facing one of the worst declines in its smartphones sales.
Apple just reported that its second quarter financial results, the company posted quarterly revenue of $58 billion, which is 5% less than the second quarter financial results of 2018. While Apple’s main revenue of source (iPhone) was facing a continuous decline, other services and hardware, however, saw growth. iPhone sales generated total revenue of $31.05 billion (less than last year). iPhone sales in this period dropped by 17% owing to sluggish smartphone demand. Mac Sales were also down but the iPad, wearables (Apple watch), home accessories and Apple services witnessed growth in sales.
“We delivered our strongest iPad growth in six years, and we are as excited as ever about our pipeline of innovative hardware, software, and services. We’re looking forward to sharing more with developers and customers at Apple’s 30th annual Worldwide Developers Conference in June.” CEO Tim Cook said in the accompanying press release.
According to CNN, Tim Cook on a conference call with several analysts said that the worst time for Apple was over as Apple was now seeing ‘signs of improvements in China’. Tim Cooke further assured that with “improved trade dialogue” between China and USA, things are looking good for Apple. Furthermore, with better pricing and increased number of discounts in China, Apple saw, “very positive customer response to the pricing actions Apple took in that market.”
Tim Cook further said that November and December were the toughest months for Apple particularly in China. With stiff competition from brands like Huawei and Xiaomi who have witnessed a dramatic increase in the market share, Apple now has a much tougher challenge to regain its lost market share in China. In the first three months of 2019, Apple generated a revenue of $10.2 billion in China which was 21% less than what Apple earned ($13 billion) same time last year.
However, with Apple’s services sales now growing at much rapid pace, all is not lost for the Cupertino giant. With services like Apple arcade, Apple TV+ and Apple card recently announced, it seems Apple is now making pivotal changes in its product policy. Whether these changes will bear fruit to Apple’s stock, only time will tell.
