The company also revealed a $110 billion share buyback, the largest in its history, following a 10% decline in iPhone sales. This drop indicates weak demand for Apple’s iPhone 15 lineup, which was released in September.
Apple recorded $45.96 billion in iPhone sales for the quarter ending March 31, slightly below projected estimates. The company’s net income for the quarter fell to $23.6 billion, a slight decrease from the same period last year.
However, Apple reported a 4% increase in Mac sales, reaching $7.5 billion, and services revenue of $23.9 billion, surpassing analyst expectations.
During an earnings call, CEO Tim Cook highlighted the positive aspects of the recent period and hinted at forthcoming details about the company’s vision for generative AI in the “weeks ahead.”
Additionally, Apple reported iPad revenue of $5.6 billion, a 17% year-over-year decrease. This announcement comes just days before a scheduled press event, where updates to the iPad lineup and related accessories are anticipated.
Despite the downturn in iPad revenue, the company expects its iPad business and services to achieve double-digit growth in the June quarter.
Apple’s wearables, home, and accessories category, which includes AirPods, the Apple Watch, and the Vision Pro, generated $7.91 billion in revenue, falling short of the $8.28 billion estimate, despite the launch of the Vision Pro.
This earnings report is the first since the release of the Vision Pro, Apple’s $3,499 mixed reality headset, which has been a significant investment for the company. Recent analyses suggest that billions of dollars were spent on its research and development.
Most recently, Apple analyst Ming-Chi Kuo reported a reduction in production by several hundred thousand units for the headset.
Cook noted that about 50% of Fortune 100 companies have purchased a Vision Pro headset “to explore things not possible yet.”
Apple shares rose more than 7% in after-hours trading following the report.
### Challenges in China
Apple has faced significant hurdles in China due to nationalism, economic struggles, and heightened competition. However, Cook mentioned that iPhone sales increased in mainland China in the latest quarter.
Chinese manufacturers like Huawei and Xiaomi have gained market share as consumers in China increasingly prefer national brands over Apple.
Market research firm IDC reported a 10% decline in Apple’s global smartphone shipments in the first quarter of this year.
“It’s a steep drop for Apple, but if you think of where we have been in the past four years, Apple has probably been the most resilient brand, overcoming supply chain issues and macro challenges, more than other brands,” said Nabila Popal, research director at IDC.
Despite these challenges, Cook highlighted that the company set revenue records in over a dozen regions, including the Middle East, Canada, Spain, and Turkey.
Apple’s stock price has fallen more than 8% in 2024 to below $170 per share, after reaching nearly $200 per share at various points in the past year. Despite these fluctuations, Apple has a market capitalization of $2.6 trillion, making it one of the largest and most powerful companies globally.
### Focus on AI
Cook also hinted at the introduction of generative-AI tools to Apple products in the near future, addressing the company’s current lag behind competitors.
“We see generative AI as a key opportunity across our products and believe we have advantages that set us apart there,” he said.
Apple is expected to introduce AI-powered tools at its annual Worldwide Developers Conference in June. The company is reportedly in discussions with OpenAI, the creator of ChatGPT, to integrate AI features into iPhones.
“We will be talking about it more as we go through the weeks ahead,” Cook added.
