<p> With iPhone sales and profits sliding, Apple has sought to highlight its growth in services as it seeks to reduce dependence on its main cash driver.<br /><br /></p>.<p>In its quarterly update, Apple said profits slumped 27 per cent from a year ago to USD 7.8 billion on a sharp drop in iPhone sales.<br /><br />Apple sold 40.4 million iPhones in the quarter ending June 25, down 15 per cent from a year earlier, highlighting concerns over growth for the company's iconic smartphone.<br /><br />It was the second straight quarter of slumping iPhone sales for the company, which until then had seen uninterrupted growth.<br /><br />Overall revenue was down 15 per cent from a year ago at USD 42.4 billion for Apple, which is the world's most valuable company.<br /><br />Chief executive Tim Cook said the results showed "stronger customer demand and business performance than we anticipated at the start of the quarter."<br /><br />Investors appeared to be reassured by the results, which were generally better than expected.<br />Apple shares rose 6.1 per cent in after-hours trade to USD 102.61.<br /><br />The results underscored the challenges for Apple, which has built a huge business around the iPhone but is unlikely to see continued growth, due to a saturated smartphone market and increased competition.<br /><br />The company said its iPad unit sales meanwhile fell nine percent from a year ago, but revenues rose due to the launch of higher-priced tablets. Mac sales were down 11 per cent.<br /><br />Apple said its services revenue rose 19 per cent year-over-year.<br />"The growth was broad-based with App Store revenue up 37 per cent to an all-time high," Cook said in a conference call.<br /><br />Cook said the company has seen success with its lower-priced iPhone SE launched earlier this year, aiming to win over more cost-conscious customers.<br /><br />"We had a very successful global launch of iPhone SE and demand outstripped supply throughout the quarter," Cook said.<br /><br />"Our sales data tells us that the iPhone SE is popular in both emerging and developed markets."<br />Apple's report showed a sharp drop in revenue from China, which reverses gains since it began selling its iPhones there.<br /><br />Revenue from "Greater China" slumped 33 per cent from a year ago to USD 8.8 billion.<br />"China was a major letdown and I'm anxious to get more details as to what specifically drove the declines," said Patrick Moorhead of Moor Insights & Strategy.<br /><br />"Samsung and Huawei are much more competitive now versus a year ago and the Chinese economy is not doing well at all, all potentially contributing to the decline. Apple is clearly investing in India to diversify their emerging region performance."<br /><br />Some analysts say Apple needs to move quickly to diversify its product base to keep growing.</p>
<p> With iPhone sales and profits sliding, Apple has sought to highlight its growth in services as it seeks to reduce dependence on its main cash driver.<br /><br /></p>.<p>In its quarterly update, Apple said profits slumped 27 per cent from a year ago to USD 7.8 billion on a sharp drop in iPhone sales.<br /><br />Apple sold 40.4 million iPhones in the quarter ending June 25, down 15 per cent from a year earlier, highlighting concerns over growth for the company's iconic smartphone.<br /><br />It was the second straight quarter of slumping iPhone sales for the company, which until then had seen uninterrupted growth.<br /><br />Overall revenue was down 15 per cent from a year ago at USD 42.4 billion for Apple, which is the world's most valuable company.<br /><br />Chief executive Tim Cook said the results showed "stronger customer demand and business performance than we anticipated at the start of the quarter."<br /><br />Investors appeared to be reassured by the results, which were generally better than expected.<br />Apple shares rose 6.1 per cent in after-hours trade to USD 102.61.<br /><br />The results underscored the challenges for Apple, which has built a huge business around the iPhone but is unlikely to see continued growth, due to a saturated smartphone market and increased competition.<br /><br />The company said its iPad unit sales meanwhile fell nine percent from a year ago, but revenues rose due to the launch of higher-priced tablets. Mac sales were down 11 per cent.<br /><br />Apple said its services revenue rose 19 per cent year-over-year.<br />"The growth was broad-based with App Store revenue up 37 per cent to an all-time high," Cook said in a conference call.<br /><br />Cook said the company has seen success with its lower-priced iPhone SE launched earlier this year, aiming to win over more cost-conscious customers.<br /><br />"We had a very successful global launch of iPhone SE and demand outstripped supply throughout the quarter," Cook said.<br /><br />"Our sales data tells us that the iPhone SE is popular in both emerging and developed markets."<br />Apple's report showed a sharp drop in revenue from China, which reverses gains since it began selling its iPhones there.<br /><br />Revenue from "Greater China" slumped 33 per cent from a year ago to USD 8.8 billion.<br />"China was a major letdown and I'm anxious to get more details as to what specifically drove the declines," said Patrick Moorhead of Moor Insights & Strategy.<br /><br />"Samsung and Huawei are much more competitive now versus a year ago and the Chinese economy is not doing well at all, all potentially contributing to the decline. Apple is clearly investing in India to diversify their emerging region performance."<br /><br />Some analysts say Apple needs to move quickly to diversify its product base to keep growing.</p>