Apple revenue dropped 15%, iPhone sale dips 15%

Apple iPhone user
iPhone maker Apple today reported 15 percent drop in revenue in its third quarter ended June 25, 2016.

The poor performance indicates that the US-based technology company’s latest iPhone launch did not do well in several key markets. Apple said the shipment of iPhones dropped 15 percent in the quarter.

Apple’s quarterly revenue reached $42.4 billion from $49.6 billion. Apple iPhone sales fell to 40.39 million units in Q3 fiscal 2016 from 51.193 million in Q2 fiscal 2016 and 47.534 million in Q3 fiscal 2015. Revenue from the sale of iPhones fell 23 percent.

Net income of Apple fell to $7.8 billion from $10.7 billion.

Apple almost maintained its gross margin at 38 percent compared to 39.7 percent in the year-ago quarter. International sales accounted for 63 percent of the third quarter’s revenue.

Apple CEO Tim Cook said that India is one of its fastest growing markets. “In the first three quarters of this fiscal year, iPhone sales in India were up 51 percent year on year. We announced a design and development accelerator to support Indian developers creating innovative applications for iOS,” Tim Cook said.

Apple recently opened a new office in Hyderabad to accelerate maps development. “We’re looking forward to opening retail stores in India down the road, and we see huge potential for that vibrant country,” Tim Cook said.
Apple revenue in Q3 2016

“On a geographic basis, our revenue grew strongly in Japan to a new June quarter record, and we experienced healthy growth in a number of other important markets, including Russia, Brazil, Turkey, India, and Canada,” Tim Cook said.

Japan was the only country where Apple could achieve improvement in revenue in Q3. Apple said its revenue fell 11 percent in Americas, 7 percent in Europe, 33 percent in Greater China, 20 percent in Rest of Asia Pacific. Apple revenue increased 23 percent in Japan.

While iPhone unit sales fell 23 percent in Q3, Apple posted 7 percent growth in iPads. Launch of 9.7-inch iPad Pro supported Apple in boosting the tablet sale. Apple posted 13 percent drop in Mac sales.

Sale of iphone SE, the latest smartphone from the device major, did not support Apple to arrest the downfall.

“Our initial sales data tells us that the iPhone SE is popular in both developed and emerging markets, and the percentage of iPhone SE sales going to customers who are new to iPhone is greater than we’ve seen in the first weeks of availability for other iPhones launched in the last several years,” said Tim Cook.

Apple said it added millions of first-time smartphone buyers in the June quarter, and switchers accounted for the highest percentage of quarterly iPhone sales.

Apple is currently gearing up for the launch of the latest iPhone. Hope it can bring out innovation to boost the sale of its smartphone business to regain its revenue growth.

Baburajan K