Apple iPhone sales decreased by 10 per cent year over year to $46 billion in fiscal Q2 (ending 30 March) and total sales from greater China fell to $16.4 billion, down from $17.8 billion a year ago.

While some of Apple’s rivals in China gained market share in Q1, Apple CEO Tim Cook hit back on the earnings call by claiming two of its iPhone 15 models are the best-selling smartphones in urban areas.

Overall company revenue fell 4.3 per cent to $90.8 billion, which Cook stated was partially due to a difficult comparison to last year’s results that included around $5 billion in revenue from “pent-up demand from the constraints” of Covid-19 (coronavirus) factory shutdowns that delayed iPhone 14 shipments.

“We expect our June quarter total company revenue to grow low single digits year over year, in spite of a foreign exchange headwind of about two and a half percentage points,” CFO Luca Maestri said.

It reported net income of $23.6 billion, down 2 per cent from $24.2 billion.

Services success
Cook and Maestri touted an all-time revenue record in Services, which includes Apple Music and its TV offerings, of $23.9 billion, up 14 per cent.

Maestri expects service revenue to continue to grow at a double-digit rate. He also predicted iPad revenue would grow by double-digits for the June quarter.

Revenue of $5.6 billion for iPad was down 17 per cent while Mac revenue of $7.5 billion was up 4 per cent.

Poised for AI
Apple plans to announce its long-awaited AI strategy when the company hosts its annual Worldwide Developers Conference in June.

“We continue to feel very bullish about our opportunity in generative AI,” Cook said. “We are making significant investments, and we’re looking forward to sharing some very exciting things with our customers soon.”

He noted “Apple’s unique combination of seamless hardware, software and services integration, ground-breaking Apple silicon, [along] with our industry leading neural engine” will differentiate the company in the new era of AI.