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Tim Cook confirms: iPhone sales are going to fall for the first time in history

iPhone Sales Decline

For the first time in iPhone history, Apple next quarter is bracing for a year over year decline in iPhone sales. As it turns out, recent reports that Apple was scaling back iPhone orders with component suppliers were more accurate than we initially gave them credit for.

DON’T MISS: This iPhone 7 concept looks like something Apple may really release

During the current March quarter, Apple anticipates that revenue will fall somewhere between $50 and $53 billion. By way of contrast, Apple during its 2015 March quarter posted revenue of $58 billion. And seeing as how the iPhone remains Apple’s primary revenue driver, it stands to reason that a drop off in revenue will be closely tied to a corresponding drop off in quarterly iPhone sales.

When asked to touch on future iPhone sales projections, Cook engaged in a bit of damage control and tried to reassure everyone that the upcoming drop-off in iPhone sales won’t be as drastic as some might believe.

“We do think iPhone units will decline in the quarter,” Cook said. “We don’t think that they will decline to the levels you’ll talk about. We aren’t going to project beyond the upcoming quarter.”

Earlier in the call, Cook tried to set a more positive tone by harping on how well the iPhone performed during the company’s recent 2015 holiday quarter. As we reported earlier, Apple last quarter sold 74.8 million iPhones during the last three months of 2015, setting a new sales record in the process.

This is a huge accomplishment for our company, especially given the turbulent world around us. In constant currency, our growth rate would have been 8 percent. Our record revenue and continued strong operating performance also led to an all-time record quarterly net income of 18.4 billion dollars. We sold 74.8 million iPhones in the December quarter, an all-time high. To put that volume into perspective, it’s an average of over 34,000 iPhones an hour, 24 hours a day, seven days a week for 13 straight weeks. It’s almost 50 percent more than our Q1 volume just two years ago, and more than four times our volume five years ago.

Indeed, investors already seem to be ignoring Apple’s record breaking quarter – both from a financial and sales perspective – as shares of Apple are currently down more than 2% in after-hours trading.

Of course, the larger question here is if the upcoming year over year decline in iPhone sales is simply an anomaly or perhaps an indication of things to come. While it may be too soon to tell, I think iPhone sales the remainder of the year will be quite impressive. Not only do we have the rumored iPhone 5se supposedly dropping sometime in April, but the iPhone 7 will likely usher in an absolutely monstrous refresh cycle.

A life long Mac user and Apple enthusiast, Yoni Heisler has been writing about Apple and the tech industry at large for over 6 years. His writing has appeared in Edible Apple, Network World, MacLife, Macworld UK, and most recently, TUAW. When not writing about and analyzing the latest happenings with Apple, Yoni enjoys catching Improv shows in Chicago, playing soccer, and cultivating new TV show addictions, the most recent examples being The Walking Dead and Broad City.

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