Apple reports increase in quarterly profits despite sales of iPhones going down

Apple reported there was an increase in the quarterly profits but its shares suffered a major loss with slow-growing revenues and sale of iPhones going down ahead of a 10-year-anniversary model on the horizon.

Apple said that its profit had risen 4.9 per cent to slightly more than USD 11 billion on revenue rising 4.6 per cent to USD 52.9 billion in the quarterly that ended April 1.

The shares of the company were down to nearly two per cent to USD 144.79 in after-market trades following the release of earning figures.

“We are proud to report a strong March quarter, with revenue growth accelerating from the December quarter and continued robust demand for iPhone 7 Plus,” Apple chief executive Tim Cook said in the earnings release.

Cook told that iPhone 7 Red Special Edition models got a ‘great’ response and the company is “thrilled with the strong momentum of our services business, with our highest revenue ever for a 13-week quarter.”

Still, sales of iPhones slowed down slightly as compared to the last year to 50.8 million units, below most forecast for the key profit machine for Apple.

Apple also announced that its board of directors has authorised an addition USD 50 billion for dividends and buying back shares in the company, raising to USD 300 billion the total amount of cash to be spent in the program during the coming two years.

While Apple has become the world’s most valuable company, analysts are looking at how the company is diversifying in the face of a saturated smartphone market and increasing competition.

The report showed weaker sales of iPads and Mac computers, and a drop in revenue from “other” products including the Apple Watch, specific figures for which were not released.

Apple also reported a 14 per cent drop in revenues from year 2016 for ‘Greater China,’ dropping the region behind Europe and the Americas in terms of sales.

Apple’s cash holdings meanwhile rose to a record $256.8 billion, a figure which raises questions for how the company will manage its massive reserves.