Apple reported another quarter of falling iPhone sales Tuesday, underscoring worries that the firm relies heavily on a flagship product that’s running out of steam.
Apple sold 45.5 million iPhones, compared with 48 million in the same period last year, a drop of 5 percent. Shares fell more than 2 percent in after-hours trading.
Many analysts expected iPhone sales to be soft, even with its chief competitor, Samsung, dealing with problems with its Galaxy Note 7 smartphones. But Apple has long-term problems with growth in smartphone sales that can’t be offset by a windfall. For example, revenue in China fell 30 percent from the year-ago quarter.
In a statement, Apple chief executive Tim Cook tried to focus attention on growth in the company’s services sector, which includes iTunes and the App Store.
“We’re thrilled with the customer response to iPhone 7, iPhone 7 Plus and Apple Watch Series 2, as well as the incredible momentum of our Services business, where revenue grew 24 percent to set another all-time record,” Cook said.
The company reported better-than-expected financial results, with a quarterly income of $9 billion — giving it earnings of $1.67 a share, higher than the $1.65 analysts expected for the company’s fourth quarter. Yet the firm posted $46.90 billion in revenue, vs. projections of $46.94 billion.
On a call with analysts, Cook highlighted the interconnectivity of Apple’s systems and the company’s ongoing investment in new technologies such as voice-activated software.
But the iPhone makes up 61 percent of the company’s revenue, and no other Apple products saw sales growth from the same time last year. Revenue for the iPad unit was flat, while Mac revenue was down 17 percent. Revenue for other products was down 22 percent.
The firm is also expected during an event Thursday to announce new laptops.
