Apple posts first profit slide in a decade

iPhone maker revenues beat expectations

 

Apple reported its first proft slide in a decade last night.

Announcing its second quarter results, the company posted profits of $9.56 billion, down $2.1 billion from the same time last year. The company sold 37.4 million iPhones in the quarter, compared to 35.1 million for the same period a year ago, and 19.5 million iPads compared to 11.8 million.

Tim Cook, Apple’s chief executive officer said: “We are pleased to report record March quarter revenue thanks to continued strong performance of iPhone and iPad. “Our teams are hard at work on some amazing new hardware, software, and services and we are very excited about the products in our pipeline.”

The change in Apple’s fortunes is being attributed to increasing competition and reports of a slowdown in sales of its iPhone and suggestions that the company has lost crucial ground to rivals such as Samsung.

Just last week, Apple lost its position as the world’s most valuable publicly traded company when its shares hit their lowest levels in a year-and-a-half.

This came after one of the firm’s suppliers — Cirrus Logic which provides sound components for the iPhone and iPad — said sales of a particular chip were slowing down. “Our cash generation remains very strong, with $12.5 billion in cash flow from operations during the quarter and an ending cash balance of $145 billion ,” said Peter Oppenheimer, Apple’s chief financial officer.

Apple plans to double the amount of capital it returns to shareholders, partly by raising debt, bowing to investors’ demands that it share more of its record $145 billion cash pile.

Shares of the company, which were halted before the release of its earnings results, jumped 5.6 per cent to $428.70 in after-hours trade.

Reuters/PA