Apple’s Revenue Down By 5%

Apple's Revenue Down By 5%
COVID, which hindered the production of Apple’s products due to lockdown restrictions in China. Apple revealed the latest reports on Thursday that its earnings fell short of Wall Street projections. The technological company stated the reason for the disappointing results was iPhone’s slow sales.

Apple’s, whose quarterly sales went down all around the world, fell by 5% to $117.2 bn except for services and iPads, all other product categories declined in sales, seeing Apple’s earnings per share drop to $1.88, which is below-projected that numbers at Wall Street.

According to numbers released by IBES statistics from Refinitiv analysts, projected sales of $121.1 bn and a share price earning of $1.94. Apple CEO, Tim Cook also disclosed that production hiccups which hindered Apple’s production are over.

The tech company also experienced certain difficulties during the fiscal first quarter, which ended on the 31st December, leading to weak numbers experienced by Wall Street. Although Apple released two flagship smartphones the iPhone 14 Pro and Pro Max, which are expected to raise Apple’s profits, did not go as planned due to COVID lockdowns at a manufacturing plant in Zhengzhou, China, which led to a supply strain.

Cook also added that manufacturing hiccups “lasted through most of December” but that “production is now back where we want it to be” in an interview with Reuters. A large chunk of China’s sales fell to 7% at $23.9 billion also due to COVID lockdowns in China, which created twin problems restraining both supply and demand.

He said that “We did observe an increase in traffic to our stores as opposed to November and an increase in demand as December came around,”.

Apple sales, which usually comes from outside America were also hurt when the US dollar strengthened, comealthough with minimal impact on Apple, since the US dollar ride didn’t last for long. Apple disclosed that the real impact of foreign exchange problems was just 8% despite the previous warning it had to given investors that such problems would have a 10% negative impact on sales.

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“I would point out that 8% is still a pretty substantial headwind. “That is not something I want to undervalue. If we had expanded at a fixed rate of exchange.” Cook disclosed to Reuters.

However, Wall Street experts are predicting decline in iPhone sales this year as well as supply chain issues, which is following the trend which the iPhone debuted in last year but sold slowly due to the robust sales recorded for iPhone 12 and 13 models for two consecutive years. Apple also recorded $65.8 bn in iPhone sales, lower than the projected $68.3 bn by analysts, an 8% decline from the previous year.

According to numbers by Refinitiv statistics, sales of Mac computers by Apple, which had recorded huge sales due to an increase in the number of remote workers, fell by 29% year on year, recording $7.7 bn compared to $9.6 bn projected figures. Although the sale of new MacBook Pro laptops which ran on Apple’s own CPUs in the previous year recorded a spike in sales, Apple officials still issued a warning that Mac sales would likely to decrease year on year.

While, sales of the iPad, according to Refinitiv statistics which also benefited from the pandemic, increased to 30% at $9.4 bn surpassing the $7.8 bn projected numbers. While the wearables and accessories unit, which includes Apple Watch and Airpods, decreased to $13.5bn by 8% from numbers projected by the analysts at $15.2bn.

Cook, however, disclosed that the new model is launched and the lack of supply of limitations, which affected sales on tablets a year earlier, is also responsible for the outstanding numbers recorded on sales of iPads. However, the tech giant is one of the major technology companies that has not announced any major layoffs, with no growth recorded in its number of staff as well. Apple disclosed that it had 164,000 employees in 2022 which shows less than a 20% increase in its numbers compared to 2019. Unlike other tech giants like Meta, Amazon, etc. which have all announced layoffs.