The company sold 40.4 million iPhones in the third quarter.
AB Wire
Technology major Apple registered 51 percent growth in the sales of iPhone in India amidst concerns of weak demand in other markets.
When the company announced its third-quarter results on Tuesday, the Indian market stood out as the center of attraction.
“India is now one of our fastest growing markets … We’re looking forward to opening more retail stores in India down the road, and we see huge potential,” Apple CEO Tim Cook told analysts, reported Reuters.
Though Apple sold more iPhones than expected in the third quarter that ended on June 25, the sales were lower compared to the second quarterly result.
The company sold 40.4 million iPhones in the third quarter exceeding the expectations of the analysts. The average sales forecast by the tech analysts was 40.02 million.
“We are pleased to report third quarter results that reflect stronger customer demand and business performance than we anticipated at the start of the quarter,” said Tim Cook, Apple’s CEO.
“We had a very successful launch of iPhone SE and we’re thrilled by customers’ and developers’ response to software and services we previewed at WWDC in June,” he added.
The revenue went down 15 percent on a year-to-year basis while the quarterly sequential change was 16 percent lower.
The Company posted quarterly revenue of $42.4 billion and quarterly net income of $7.8 billion. These results compare to revenue of $49.6 billion and net income of $10.7 billion in the year-ago quarter.
Gross margin was 38 percent compared to 39.7 percent in the year-ago quarter. International sales accounted for 63 percent of the quarter’s revenue.
The sales of iPhone in China showed considerable contraction mainly owing to the uncertain economic conditions in the Asian country. Sales in Greater China slumped continuously in the third quarter by 33.1 percent after registering a 26 percent decrease in the second quarter. Greater China had registered a whopping 112.4 percent growth last year.
“It is very clear that there are some signs of economic slowdown in China, and we will have to work through them,” Chief Financial Officer Luca Maestri told Reuters in an interview.
Surpassing the expected limit of $2 billion, the channel inventory was reduced by about $3.6 billion, pointing towards a better than expected sales.
Another bright spot for the Cupertino-based company is the revenue from services that include App Store, Apple Pay, iCloud and other services. The revenue from services showed 18.9 percent growth compared to last year.
With the tremendous growth in the third quarter, for the first time, service business has become the second best business of Apple after iPhone. Other products like iPad, Mac, and small gadgets seem to have a lesser impact on the revenue. The sales of iPhone account for about two-third of Apple’s revenue.
“Our Services business grew 19 percent year-over-year and App Store revenue was the highest ever, as our installed base continued to grow and transacting customers hit an all-time record,” said Apple’s CFO Luca Maestri.
For the first time since 2003, Apple suffered a revenue drop this year after iPhone unit sales fell nearly 16 percent from 61.2 million units last year to 51.19 million this year.
Though Apple has suffered a revenue loss, the growth rate of the company has been stable in India with an increased shipment of 56%, making it the second fastest growing smartphone vendor in the market.