In the second quarter of this financial year, the revenue of the US high-tech giant Apple fell by 12.7% in comparison to that of Q2 of 2015, standing at a $50.6 billion. This is of especial significance since it is the first time that Apple has seen a fall in revenue for the past 13 years.
Weak revenue has become the reason the company’s net profit has fallen by 23% to $10.5 billion in comparison with the same period in 2015. On this news, Apple shares fell 8% and the fall is continuing today, shedding almost another percent. The company explains this via unsuccessful iPhone sales which fell in Q2 of this year by 16% and the even more unsuccessful iPad sales which have fallen 19% YoY.
Geographically, Apple sales have seen the biggest fall in China where sales have fallen 26%. Even at home Apple hasn’t been doing so well, with sales in the US during Q2 fell by 10%.
We believe that the reason for Apple’s failure is related to the partial updates for iPhone in tandem with a fall in the hype around the iPhone, leading to a reduction in consumer interest in new models of this smartphone. Economic problems around the globe haven’t aided sales of the expensive gadget either.