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Decline in Apple Sales
For the first time in around 13 years, there has been a decline in Apple’s amazing iPhone sales. The company announced that it sold only 74.8 million iPhones during the holiday season last year which is an impressive figure for any company except Apple. Apple expects a further decline in sales which could be $50 billion to $53 billion which is down from $58 billion during the previous year. The current sales figures show an increase of just 0.4% which is the slowest since the iPhone was launched in 2007. Besides, Apple is not doing as well in China as was predicted because China is a major market for the company in its worldwide growth program.
It finally seems that the $500 billion company is reaching the end of its limitless growth. The CEO of Apple, Tim Cook acknowledged some issues in China while consolidating Apple’s promises that it made for growth in China. Although there are signs of economic decline in China, the CEO said that he is optimistic and does not subscribe to the gloomy predictions about the Chinese which he says will eventually see an upturn very soon. Other countries where sales have declined are Brazil, Russia, Japan and Canada that are facing economic slowdowns which have affected the overall sales of iPhones.
Besides China, Apple is planning to double its investments in India where sales are growing. The company plans to open more retails stores to take advantage of the demand for its products in India. The reason for the decline in sales can be attributed to the fact that the iPhone has reached its saturation point and also that the company is upgrading some of its major products. The market for Apple products has dropped by more than $30 billion in the first few weeks of 2016. However, the company is optimistic about its future prospects and increased sales. The decline in sales has led to a drop in its stock values and has caused many investors shed the stock in recent weeks.
The iPhone 6 components are going to be the most important issue for the current year and that is what is going to matter in the first few months. The iPhone sales currently represent 63% of its quarterly revenues according to its latest press releases citing its revenues for the last quarter of 2015. The decline will impact the company’s quarterly earnings by at least 11 percent. Despite the introduction of the larger iPad Pro, the earning still continued to drop. Sales of Apple’s smart watch are growing but the company does not give out figures for its smartwatch sales.
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