Apple iPhone Sales, Shares Fall
World Economy

Apple iPhone Sales, Shares Fall

Apple Inc reported a surprise fall in iPhone sales for its second quarter on Tuesday, indicating that customers may have held back purchases in anticipation of the 10th-anniversary edition of the company’s most important product later this year.
Under pressure from shareholders to hand over more of its $250 billion-plus hoard of cash and investments, Apple boosted its capital return program by $50 billion, increased its share repurchase authorization by $35 billion and raised its quarterly dividend by 10.5%, Reuters reported.
Investors were unmoved, sending shares of the world’s most valuable listed company down 1.9% at $144.65 in after-hours trading.
Apple sold 50.76 million iPhones in its fiscal second quarter ended April 1, down from 51.19 million a year earlier. Analysts on average had estimated iPhone sales of 52.27 million, according to financial data and analytics firm FactSet.
Apple Chief Financial Officer Luca Maestri argued the decline was not as bad as it looked, given the peculiarities of how phone sales are calculated.
The company reports what are called “sell-in” figures for the iPhone, a measure of how many units it sells to retailers, rather than “sell-through” figures, which measure how many phones are actually sold to consumers.
Maestri said the company reduced the volume of inventory going through its retail channel by about 1.2 million units in the quarter, meaning the company sold about 52 million phones to customers on a sell-through basis. Despite the dip in unit sales, iPhone revenues rose 1.2% in the quarter, helped by a higher average selling price.
Meanwhile, expectations are building ahead of Apple’s 10th-anniversary iPhone range this fall, with investors hoping that the launch would help bolster sales. Apple typically launches its new iPhones in September.
A big jump in sales usually follows in the holiday quarter, before demand tapers over the next few quarters as customers hold back ahead of the next launch.
Apple’s 10th-anniversary iPhone range might sport features such as wireless charging, 3-D facial recognition and a curved display.
The company forecast total revenue of between $43.5 billion and $45.5 billion for the current quarter, while analysts on average were expecting $45.60 billion, according to Thomson Reuters. Analysts on average expect the company to sell 42.31 million iPhones in the current quarter, according to FactSet.
For the second quarter, the company’s net income rose to $11.03 billion, or $2.10 per share, compared with $10.52 billion, or $1.90 per share, a year earlier.

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