Apple iPhone sales drop by 5.5% year on year

Apple’s iPhone sales have dropped by 5.5% year on year according to the firm’s fourth quarterly report which runs in the three months to September 24.

Apple reported sales of 45.5 million phones in the fourth quarter, down from 48 million during the same period in 2015.

The management of the company said that although sales rose compared with the previous quarter in 2016 from 40.4 million, stressing that, it was the third quarter in a row that Apple had reported a year-on-year drop in sales of the phone.

The tech giant also reported a 10.3% fall in net revenue from $51.5bn (£42.3bn) in the fourth quarter last year to $46.9bn in the current period. Period on period, net sales increased 10.6% from $42.4bn in the three months to 25 June.

Meanwhile, the Apple could miss a chance to maximise Christmas sales as the company has declared that it was caught off guard by how many people want to buy its biggest smartphone, the iPhone 7 Plus, and the miscalculation may hit profits this holiday season.

The technology leader is not sure it can make as many units of the iPhone 7 Plus as consumers want in time for the Christmas shopping rush, Apple’s Chief Executive Tim Cook told analysts on Tuesday. It will manage to make enough of the smaller iPhone 7s, though, he said.

Demand was strong “particularly on the iPhone 7 Plus versus our forecast going into the product launch,” Cook said.
The bigger phones bring bigger profits, and Apple’s forecast for thinner-than-expected margins concerned investors after it reported quarterly earnings on Tuesday.

Apple issued a conservative outlook on margins for the holiday quarter, 38 percent to 38.5 percent, versus expectations of nearly 39 percent, said Mariann Montagne, Senior Investment analyst and Portfolio Manager at Gradient Investments.

It was not immediately clear if the smartphone shortage caused the miss.
“You’re not able to get that product into the hands of the person who wants it right here, right now,” said IDC analyst John Jackson. “Those are dollars not in your hands.”


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