Apple Profits, Revenues Dropped in Q1 as iPhone Sales Fall

Apple sold fewer iPhones in the first quarter than it did one year ago, triggering a year-over-year (YOY) decline in revenues and a $110 billion stock repurchase.

The consumer electronics giant reported a net income of $23.6 billion on revenues of $90.8 billion in the quarter ending March 30. Those figures represent declines of about 2 percent and 4 percent YOY, respectively.

“Today, Apple is reporting an all-time revenue record in Services,” Apple CEO Tim Cook said. “During the quarter, we were thrilled to launch Apple Vision Pro and to show the world the potential that spatial computing unlocks. We’re also looking forward to an exciting product announcement next week and an incredible Worldwide Developers Conference next month. As always, we are focused on providing the very best products and services for our customers, and doing so while living up to the core values that drive us.”

Notably, Apple didn’t mention the term “iPhone” once in its earnings announcement. That might be because revenues in Apple’s biggest and most important business fell over 10 percent YOY, from $51.3 billion in the first quarter of 2023 to $46 billion this past quarter. The iPhone delivered almost exactly 50 percent of Apple’s revenues in the quarter.

Apple’s second-biggest business, Services, grew by 14 percent to $23.9 billion. And the Mac experienced strong growth as well, no doubt thanks to my MacBook Air purchase, with revenues up about 4 percent to $7.5 billion.

Apple’s other businesses followed the iPhone downward, with Wearables, Home, and Accessories revenues falling 9.6 percent to $7.9 billion and iPad revenues down 16.7 percent to $5.6 billion. Apple is expected to release new iPads next week, so that business should show a bit of bump in the coming quarter at least.

Apple’s iPhone woes can be attributed largely to China, where homegrown rivals like Huawei are experiencing massive growth, compared to a 19 percent drop for iPhone. But Apple predicted revenue growth in the current quarter, and that, and a $110 billion common stock buyback, spared it the indignity of a stock free-fall.