Apple returns to iPhone growth, profit declines - Mobile World Live

Apple returns to iPhone growth, profit declines

01 FEB 2017

Apple announced a quarter of “all-time records”, including a return to growth for its flagship iPhone product line in the final three months of 2016 – the vendor’s fiscal Q1 2017.

In a statement, CEO Tim Cook said: “We’re thrilled to report that our holiday quarter results generated Apple’s highest quarterly revenue ever, and broke multiple records along the way. We sold more iPhones than ever before and set all-time revenue records for iPhone, Services, Mac and Apple Watch.”

The company shifted 78.3 million iPhones during the quarter, an increase of 5 per cent year-on-year, which was accompanied by 5 per cent increase in iPhone revenue to $54.4 billion.

In a conference call the company said while iPhone 7 was its most popular model, it also saw “especially strong demand” for the larger (and more expensive) iPhone 7 Plus with demand exceeding supply through the period.

Sales in the Services unit, which includes digital content and services and Apple Pay among others, increased 18 per cent to $7.2 billion. The company previously trumpeted App Store success during the period.

Sales of “other products”, which includes a hotchpotch of Apple TV, Apple Watch, Beats-branded products and accessories, decreased 8 per cent to $4 billion.

However, iPad continued to be a weaker performer. Sales of 13.1 million units were down 19 per cent year-on-year, while revenue of $5.5 billion was down 22 per cent.

On a group level, the company reported a profit of $17.9 billion, down 2.6 per cent on the same period of 2015. Revenue of $78.4 billion was up 3.3 per cent.

Geographically, Apple saw growth in four out of its five market regions – the exception being Greater China. Cook said sales in mainland China were flat year-on-year, but noted Apple faced currency challenges and Hong Kong “remains a very, very difficult market”.

International sales accounted for 64 per cent of the company’s revenue during the quarter.

Cook also briefly touched on the company’s recently-initiated legal action with Qualcomm. “I don’t like litigation. And so if there’s another way, then that would be great, but at this point I don’t see it,” he said.

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Steve Costello

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