Apple warns on revenues as iPhone sales stagnate

Apple is predicting a revenue drop for the next quarter, after posting record financial results for the first quarter of 2016.

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Tech giant Apple has posted record quarterly results , but warns that a revenue dip could be on the horizon.

The company has recorded a record quarterly revenue of $75.9 billion (£53 billion) and a record quarterly income of $18.4 billion (£12.8 billion).

In the same quarter of last year it recorded first quarter net profits of $18 billion (£11.8 billion) which at the time were the biggest quarterly profits ever made by a public company.

Product sales have dropped or stagnated

However, Apple is predicting a drop in revenues for the next quarter, saying that it expects revenues of $50-$53 billion (£35-£37 billion). This is a drop from the $58 billion (£40.5 billion) revenues it reported in the second quarter of 2015.

The revenue warning comes as sales of Apple’s iPad have dropped by a quarter year on year and Mac sales have dipped by 4% over the same period.

Sales of the iPhone – far and away Apple’s most popular product – have stagnated year-on-year, but the company still sold a record 74.7 million units in the quarter.

Still record results

Apple chief executive hailed the record results, saying that they were “thanks to the world’s most innovative products”.

He added: “The growth of our Services business accelerated during the quarter to produce record results, and our installed base recently crossed a major milestone of one billion active devices.”

Meanwhile Apple’s chief financial officer Luca Maestri acknowledged the challenging circumstances, saying: “Our record sales and strong margins drove all-time records for net income and EPS in spite of a very difficult macroeconomic environment.”

Apple’s next generation of the iPhone, the iPhone 7, is expected to launch later this year, with rumours suggesting that the phone’s home button could be dropped to make the screen bigger for new 3D touch technology.

Discover more:

• Apple sells record number of iPhones as rumours emerge of next-generation model

• Apple launches a stylus, but what would Steve Jobs think?

• Apple posts biggest quarterly profit in history

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