Apple Inc. posted falling sales for its iPhone highlighting a big need to launch new, blockbuster features in its latest generation of the company’s flagship device if it hopes to fend off its rivals such as Samsung Electronics.
Confidence amongst investors has increased leading up to the major revamp of the next iPhone later in 2017.
Competitors have already released their new revamps of their high-end handsets recently, which puts even more pressure on Apple to launch a device that is sufficiently advanced to entice users who already have an iPhone to upgrade as well as lure in new buyers.
Apple during its quarter that ended April 1 sold 50.9 million iPhones down from the same quarter last year when it sold 51.2 million. It was less than 51.4 million units sold which was the average estimate of Wall Street analysts.
CEO Tim Cook during his conference call on Tuesday with analysts said the company believes it is seeing a pause in iPhone purchases which he feels is due to the earlier and far more frequent leaked reports over the future iPhone.
During the past, the Cupertino, California based company changed the iPhone’s basic shape every couple of years. Last September the iPhone 7 was unveiled with similar shape and features as its predecessor which extended the shape cycle to three years.
Because of that, more customers might be holding out for the launch of the latest version in September of this year and putting off buying a new one.
Apple stock was down close to 2% in afterhours trading on Tuesday. Shares have increased by 27% in 2017 and were at a record high Tuesday before the launch of Apple’s sales figures and in anticipation of the launch of the iPhone 8.
New screens have been tested by Apple, curved glass, new cameras, augmented reality and stainless steel materials, but the final product will remain under tight wraps until September.
Often times photos are leaked that end up looking similar to the product when launched, but Apple will be careful to keep that to a minimum to create even more anticipation leading up to the unveiling.
Apple ended the quarter with cash and its equivalents of $257 billion. The company said it would return even more of its cash to its shareholders, announcing a new buyback of $50 billion and a dividend of 63 cents.
Apple forecast revenue of between $43.5 billion and $45.5 billion for its current quarter, below the $45.6 billion forecast by analysts.
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