The fall has been attributed to a slump in sales of the company’s iPhone, which accounts for around two thirds of overall sales. iPhone sales tumbled 16 percent in the last quarter, with the majority of that decline being attributed to the economic slowdown being seen in China, the company’s second most important market after the US. There sales of the iPhone fell more than a quarter.
Globally sales of the iPhone totalled 51m in the past quarter worth $32.9bn, last year Apple brought in $40.3bn from sales of 61.2m phones.
Company CEO, Tim Cook, said that, “Despite the pause in our growth, our results reflect excellent execution by our team despite strong macroeconomic headwinds in most of the world.”
Is this a problem unique to Apple?
Not really, according to most analysts. The market for smartphones appears to be slowing with the cost of devices still too high for many in the developing world, while established markets may have hit saturation point.
This time last year Apple saw sales soar as it launched the iPhone 6 – according to the company is was selling $650m of gadgets each day.
While the company is promising some ‘amazing’ new innovations in the coming months with the launch of the iPhone 7 a growing number of analysts and commentators are suggesting that 2015 may well have been the peak year for the iPhone and the success of the iPhone 6 will be very hard to replicate.
Last year’s success was driven by Apple’s development of larger screens and its move to develop a phablet device, which had proved remarkably successful in Asian market. It’s doubtful that, at least in the short to medium term, it will be able to repeat that remarkable success.
Increasingly in the smartphone market innovation is getting harder to come by. New products, whether from Apple or its competitors, have hardly shaken the market and we seem to be seeing more incremental change than the ‘big bang’ of years gone by.
Iteration seems to be the norm, according to most analysts watching the market. But then when you’re building a cash mountain larger than many countries GDP and investing in a host of new technologies from an electric car to virtual reality devices, I wouldn’t feel too sorry for Apple or its shareholders.
