Apple reported its first revenue decline in 13 years in its latest quarterly earnings, in which a significant discrepancy with Wall Street expectations was seen. Revenue was down 13 per cent in the first quarter from the year before, at US$50.6 billion, with earnings per share falling by 18 per cent to US$1.90. These figures can be attributed to the historic decline in Apple’s iPhone sales, which forms the foundation of the tech giant’s global empire. Apple’s shares fell immediately by 7.9 per cent, trading at US$96.10. It also issued a grim revenue forecast of US$41 billion to US$ 43 billion, falling short of the US$47 billion most analysts had in mind.
In the first quarter of 2016, Apple ingeniously tweaked its iPhone preorder periods in order to narrowly top the previous year’s profit, revenue and sales records. Demand for iPhones in 2015 was not quite as high as the previous year’s, so the iPhone 6s and iPhone 6s Plus was launched earlier in China than it was in 2014, achieving sales growth. Apple therefore ran the risk of significant sales declines in the second quarter of 2016 by cramming all of its iPhone sales into the first quarter. Nevertheless, despite the gloomy figures, CEO Tim Cook defends Apple’s continued prosperity, stating that the slowdown in the smartphone market was a result of temporary macroeconomic vulnerabilities. He also predicted that conditions would improve again, stating that, “the market, and particularly us, will grow again.”