Apple Expects First Ever Decline of iPhone Sales Next Quarter

Apple CEO Tim Cook confirmed during the company's financial earnings conference call today that iPhone sales will likely decline in the March quarter, marking the first year-over-year decline since the smartphone was released in June 2007. The decline will be realized if Apple sells fewer than 61.2 million iPhones this quarter.

Apple forecasts that its total revenue in Q2 2016 will be between $50 and $53 billion, compared to $58 billion in the year-ago quarter, signaling the company's first year-over-year drop in revenue in thirteen years. Apple has posted over 50 quarters of year-over-year revenue growth since 2003.

Apple is currently facing significant foreign exchange headwinds. A strong U.S. dollar makes it more difficult for Apple, which reports its earnings in U.S. dollars, to perform when some 66% of their business is overseas. Every $100 of Apple’s non-U.S. dollar revenue earned in Q4 2014 translates into only $85 U.S. dollars today.

iPhone-trio
Financial analysts had already predicted the iPhone would face its first quarterly sales decline in Q2 2016 compared to the year-ago quarter, with some reports claiming the iPhone 6s and iPhone 6s Plus may not outsell last year's iPhone 6 and iPhone 6 Plus, its first devices with larger than 4-inch screens.

iPhone growth in the just-announced first fiscal quarter of 2016 was the slowest since the smartphone's introduction in 2007. Apple sold a record 74.8 million iPhones during the quarter, which includes the busy holiday shopping season, up only 300,000 units from 74.5 million a year earlier.

Nevertheless, Cook said that 60% of customers who have owned an iPhone prior to the iPhone 6 and iPhone 6 Plus have not yet upgraded, meaning there is a large base of potential customers that could upgrade to newer models, including the iPhone 7 expected in September, over the coming year.

Today's announcement has been referred to by some as "peak iPhone," but Cook remains optimistic about annual iPhone sales in 2016. Even if Apple sells a projected 45 to 50 million iPhones next quarter, that would still be more revenue from one product than most companies earn overall in a single quarter.

Top Rated Comments

Alienzed Avatar
63 months ago
1) Steve Jobs was right. Phablets are stupid and DROPPING the 4inch phone from the upgrade cycle from also really stupid. I personally do not want a giant phone, if anything I'd be very happy with a tiny one.

2) The new products are not aesthetically pleasing... the new iPhone looked weird, face it. What are those lines? They don't look good, it's not "simple". Ivy wagwon?

3) Apple keeps handicapping it's computers... The iMac is a desktop, it doesn't need tapered edges, it doesn't need to be [that] thin. We don't get CD/DVD drives anymore and have to deal with mobile processors and mobile GPUs because you want the 27inch computer in a monitor to be thin? That's stupid.

4) Single port laptop, including the charging port?

Stupid moves make for declining sales. Smarten up Tim.
Score: 68 Votes (Like | Disagree)
spiderman0616 Avatar
63 months ago

Apple Expects First Ever Decline of iPhone Sales Next Quarter
cuz everyone wants their headphone jack.

What a stupid post.
Score: 33 Votes (Like | Disagree)
KingOfStuff Avatar
63 months ago
Apple Expects First Ever Decline of iPhone Sales Next Quarter
cuz everyone wants their headphone jack.
Score: 31 Votes (Like | Disagree)
maxsix Avatar
63 months ago
No surprise and not a big deal. It's the natural dynamic. A sign that Apple needs to focus and bring something fresh and new to the party. Something other than a car.
Score: 23 Votes (Like | Disagree)
okboy Avatar
63 months ago
It has nothing to do with the iPhone 6S. It's because the value of other currencies is dropping respective to the US dollar, and Apple has significantly increased the price of the 6S in many markets. It's simple micro economics: increase the price and sales drop.
Score: 19 Votes (Like | Disagree)
asharahmed Avatar
63 months ago
Probably just sticker shock from the disappearance of contracts...
Score: 18 Votes (Like | Disagree)

Top Stories

0 Deals Hero

Black Friday 2020: Best Apple Deals to Plan For

Saturday November 21, 2020 10:00 am PST by
In the lead-up to Black Friday next week, we've been putting a spotlight on the best deals coming from various retailers like Best Buy and Walmart. In an effort to further prepare our readers for the best Black Friday deals, we're breaking down what we think should be on your radar for Black Friday in 2020. Note: MacRumors is an affiliate partner with some of these vendors. When you click a...
2020 apple shopping event

Apple Offering Up to $150 Gift Card With Select Products on Black Friday Through Cyber Monday

Monday November 23, 2020 2:53 am PST by
Apple has announced its annual four-day shopping event, offering customers up to a $150 Apple Store gift card with the purchase of select products between Black Friday and Cyber Monday in the United States. The gift card values in the United States are as follows: $150 for 16-inch MacBook Pro $150 for 21.5-inch iMac $50 for 13-inch MacBook Pro $50 for MacBook Air $50 for iPhone SE,...
m1 mac mini vignette

Apple Lists M1-Based Mac Mini Logic Boards With 10 Gigabit Ethernet in Internal Parts Ordering System

Friday November 20, 2020 9:32 am PST by
While the new Mac mini with the M1 chip is only available with Gigabit Ethernet, Apple has listed multiple M1-based Mac mini logic boards with 10 Gigabit Ethernet in an internal parts list for Apple Authorized Service Providers. For every Mac mini logic board with Gigabit Ethernet in the parts list, obtained by MacRumors, there is a corresponding logic board with 10 Gigabit Ethernet:...
ipad pro 2020 display

Black Friday Week Kicks Off With Up to $150 Savings on 2020 iPad Pro

Sunday November 22, 2020 2:37 pm PST by
As we head into Black Friday week, we're seeing some of the best deals of the season so far, with Amazon and Best Buy today discounting the latest iPad Pro models by up to $150 at the lowest prices we've ever tracked on these models. Note: MacRumors is an affiliate partner with some of these vendors. When you click a link and make a purchase, we may receive a small payment, which helps us keep ...
macos big sur m1 macs restore issue

Apple Provides Instructions to Fix macOS Reinstallation Errors on M1 Macs

Sunday November 22, 2020 3:30 pm PST by
Shortly after the launch of Apple's new M1 Macs, we saw reports that attempts to restore and reinstall macOS on those machines right away could result in an installation error that would leave your Mac non-functional. Specifically, the error message would read: "An error occurred preparing the update. Failed to personalize the software update. Please try again." Over the weekend, Apple p...
iPhone 6s main

Rumor Claims iOS 15 to Drop Support for iPhone 6s and Original iPhone SE

Sunday November 22, 2020 9:25 am PST by
Apple will drop support for the iPhone SE, iPhone 6s, and iPhone 6s Plus in next year's release of iOS 15, according to a rumor shared today by Israeli site The Verifier. If the rumor is accurate, that would mean iOS 15 will be compatible with the following Apple devices: 2021 iPhone series iPhone 12 Pro Max iPhone 12 Pro iPhone 12 mini iPhone 12 iPhone 11 iPhone 11 Pro iPhone 11 Pro ...
new m1 chip

Craig Federighi: Native Windows on M1 Macs is 'Really up to Microsoft'

Friday November 20, 2020 11:57 am PST by
Following the release of the M1 Macs Apple executives have been doing interviews with a range of publications, and today, Ars Technica published another interview with software engineering chief Craig Federighi, hardware technologies lead Johny Srouji, and marketing VP Greg Joswiak. Much of the interview focuses on topics that the three have already covered in prior discussions, but there is ...
Walmart November Deals Hero

Black Friday Spotlight: Walmart Will Have AirPods Pro Down to Lowest Price of $169, and More Apple Deals

Thursday November 19, 2020 8:05 am PST by
We've been tracking early Black Friday deals in our dedicated Black Friday Roundup, and in an effort to prepare our readers for the big shopping event we're highlighting sales store-by-store in the lead-up to November 27. Note: MacRumors is an affiliate partner with Walmart. When you click a link and make a purchase, we may receive a small payment, which helps us keep the site running. Next ...
xlK6MS4MLqVFaskl

iFixit Shares iPhone 12 Pro Max Teardown Revealing L-Shaped Battery and Bigger Camera Module

Sunday November 22, 2020 2:53 am PST by
In the last of its iPhone 12 series teardowns, iFixit has published its iPhone 12 Pro Max disassembly, which reveals some unique differences in the design of the internals, including the full extent of the larger camera system responsible for the improved low-light performance on Apple's largest iPhone to date. On opening the iPhone 12 Pro Max, the first obvious difference compared to the...
apple leather sleeve

Leather Sleeve for iPhone 12 Models Now Available From Apple

Friday November 20, 2020 12:16 pm PST by
Apple today began selling the Leather Sleeve for the new iPhone 12 models, with the accessory having first been announced alongside the updated iPhones in October. Priced at $129, the Leather Sleeve is not a case and is designed to be removed when the iPhone is in use. It features a cutout at the front that displays the time, and it comes with a matching leather strap. According to Apple, it ...