Apple reported its first annual revenue decline in 15 years as sales of the iPhone continue to shrink and Wall Street frets that the world’s most valuable company doesn’t have a game-changing new product to revive its growth.
Shares of Apple’s stock slipped about 2 percent in after hours trading on Tuesday.
In the three months ended September 24, Apple said its revenue declined about 9% year on year. The company’s $46.9 billion in fiscal Q4 revenue was in line with Wall Street’s lackluster expectations, as Apple marked the third consecutive quarter that iPhone sales have declined.
Apple CEO Tim Cook said that the recently released iPhone 7 and 7 Plus models were off to a strong start, with demand for the phones outstripping supply.That will help Apple return its revenue to growth in the next quarter, he said.
“It’s very hard to gauge demand as you know when you’re selling everything you’re making,” Cook said on a conference call.
Cook deflected analyst questions about the company’s rumored efforts developing self-driving car technology during a conference call, describing the potential for technology to revolutionize the car experience as “interesting.”
Here's what Apple reported for the September quarter:
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Q4 EPS (GAAP): $1.67 per share, down 14.79% year-over-year (y/y), versus expectations of $1.65
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Q4 revenue: $46.9 billion, down 8.93% y/y, versus expectations of $46.9 billion
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Gross margin: 38%, down 4.76% y/y, versus expectations of 37.9%
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iPhone unit sales: 45.5 million, down 5.3% y/y, versus expectations of 45 million
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iPhone ASP: $618, down 7.7% y/y, versus expectations of $625
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iPad unit sales: 9.2 million, down 6.8% y/y, versus expectations of 9.1 million
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Mac unit sales: 4.8 million, down 15.7% y/y, versus expectations of 5.1 million
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December quarter revenue guidance: Between $76 billion and $78 billion. At its midpoint, that guidance suggests 1.44% growth next quarter over last year.