Apple has booked a double-digit increase in revenue for the first quarter of its fiscal 18, but second-quarter forecasts have fallen short of analyst expectations, driving concerns about future demand for its flagship iPhone products.
The tech giant booked a 13 per cent increase in sales to $88.3 million for the three months ended 30 December after increasing the price of its latest smartphone the iPhone X last year.
But despite the record quarter Apple has forecast its 2Q18 revenue to be between $60 billion and 62 billion – short of the $65.7 billion Reuters consensus estimate.
The number of iPhones sold by the company actually decreased by 1 per cent year-on-year, despite the price rise driving a 13 per cent increase in revenue from the product.
Ipad sales increased by 1 per cent globally year-on-year, while Mac sales declined by 5 per cent.
Apple’s unaudited revenue for its “rest of Asia Pacific” region – which includes Australia- increased by 17 per cent year-on-year, with total sales of US$6.8 billion in the quarter.
Apple CEO Tim Cook said he was “thrilled” with what is the biggest quarter in the company’s history.
“We’re thrilled to report the biggest quarter in Apple’s history, with broad-based growth that included the highest revenue ever from a new iPhone lineup. iPhone X surpassed our expectations and has been our top-selling iPhone every week since it shipped in November,” said Tim Cook, Apple’s CEO.
“We’ve also achieved a significant milestone with our active installed base of devices reaching 1.3 billion in January. That’s an increase of 30 percent in just two years, which is a testament to the popularity of our products and the loyalty and satisfaction of our customers.”
Apple is forecasting operating expenses for Q218 to be between $7.6 billion and $7.7 billion, comparable to its Q118 operating expenses of $7.6 billion.
GlobalData Retail managing director said the slowdown in iPhone sales was a worrying trend for Apple.
“Apple has been quick to point out the record-breaking revenue numbers for its first quarter. As much as this is praiseworthy, it also masks some more worrying trends,” he said.
“The slowdown in iPhone sales is emblematic of Apple’s inability to come up with meaningful and valuable innovations that wow consumers.
“Even the iPhone X is an incremental product that lacks the excitement and newness earlier models brought to market.
“Apple is fortunate in having a strong base of fans and many consumers who are bought into its ecosystem of services; but without device innovation, even this may prove insufficient to maintain market share in the face of rising competition,” Saunders continued.