The world’s most valuable tech company, which relies on the iPhone for half its sales, reported Thursday that revenue fell 1%, to $81.8 billion, during the three months that ended in June. Profit increased 2%, to $19.88 billion.
While Apple did not experience the rapid growth that investors have come to expect over the years, and the sales decline was the third of its fiscal year, the company narrowly exceeded Wall Street expectations for sales and profit for the quarter.
Apple’s financial results were the latest indication that tech’s biggest companies have found their footing after last year’s downturn. Last week, Facebook’s parent company, Meta, and Google’s parent company, Alphabet, reported double-digit growth in profits driven by a rebound in digital ad sales. Microsoft posted a record quarterly profit behind a surge in cloud-computing sales, and Amazon on Thursday posted nearly twice the profit expected by Wall Street.
The tech industry limped through much of 2022 because of weak digital ad, e-commerce and computer sales. The downturn led Meta, Alphabet, Microsoft and Amazon to lay off thousands of workers and spurred companies across Silicon Valley to cut back on perks such as free laundry services for employees.
Though Apple avoided layoffs, it is now dealing with how much the pandemic turbocharged its business. Sales of iPads and Macs exploded as people began working from home, but new purchases of tablets and computers have sputtered over the past year. In the latest quarter, iPad sales decreased 20%, to $5.79 billion, and Mac sales declined 7%, to $6.84 billion, the company said.
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Apple’s share price fell about 2% in after-hours trading after the company projected that sales in the current quarter would be similar to the April-to-June period, as accelerating iPhone and software sales are offset by double-digit declines in sales of Macs and iPads. In the June quarter, the company made $39.67 billion from iPhone sales, down 2% from a year earlier. In China, where total smartphone industry sales fell 4% during the quarter to their lowest levels since 2014, iPhone sales increased 7%, according to Counterpoint Research, a technology research firm. That helped Apple post 8% sales growth in China.
