Apple sees surprise fall in iPhone sales

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Apple sees surprise fall in iPhone sales

Apple sold fewer iPhones than a year ago in the first three months of 2017, the company said in its latest results.

The California company, which is due to release a new phone later this year, said it sold 50.8 million iPhones in the period, down 1% year-on-year.

Apple reported a 4.6% rise in revenue across the whole company, slightly below analysts’ expectations.

Shares in the firm fell nearly 2% in after-hours trading after earlier hitting a record high.

Apple said quarterly profits were $11bn (£8.5bn), up 4.9% from the same period in 2016.

Despite falling unit sales, revenue from the iPhone still climbed 1% to $33.2bn as it sold more of the bigger, more expensive iPhone 7 Plus.

Analysis: Dave Lee, BBC North America technology reporter

This is always the least impressive time of year for Apple’s earnings, come as it does after the Christmas period. But worse-than-expected iPhone sales had investors slightly unhappy after anticipation of strong earnings sent shares to record highs earlier on Tuesday.

That said, revenues are up, in part because of “robust” sales of the iPhone 7 Plus, the bigger, pricier model.

Tim Cook told investors he was also pleased with the continued growth of its Services division – that’s things like Apple Music, Apple TV, iTunes and so on – but the health of Apple is only realistically measured with the success of that all-conquering smartphone.

Which is why the rest of the year will be exciting to watch.

With the iPhone’s 10th anniversary upon us, expectations are high for the next device.

Anything short of a major improvement would be troubling for investors who are banking on the next iPhone being a blockbuster, not an incremental upgrade.

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