Apple iPhone sales plummet as shares rise on dividend, share buyback news | Technology

iPhone sales fall 10% amid growing competition from Chinese rivals like Huawei.

Apple’s revenue fell for the fifth consecutive quarter, driven by the sharpest decline in iPhone sales since the early days of the COVID-19 pandemic.

The California-based technology giant on Thursday reported a profit of $23.6 billion on $90.8 billion in revenue during the January-March period.

iPhone sales fell 10% to $45.7 billion amid growing competition from Chinese rivals such as Huawei and Xiaomi.

Sales in Greater China, one of Apple’s most important markets, fell to $16.4 billion from $17.8 billion year on year, a decline of nearly 8%.

The drop in sales marked the biggest drop since the third quarter of 2020, when factory closures due to COVID delayed the launch of the iPhone 12.

Still, the drop in revenue exceeded investor expectations and the company’s shares rose on news of a share buyback and higher quarterly dividends.

Apple shares rose nearly 6 percent in after-market trading as the company announced it would repurchase $110 billion of its own shares and increase its quarterly dividend by 4 percent to 25 cents per share.

“Thanks to very high levels of customer satisfaction and loyalty, our active installed base of devices reached a new all-time high across all products and all geographic segments, and our business performance drove a new EPS record in the March quarter ”, stated Apple. CFO Luca Maestri said in a statement.

“Given our confidence in Apple’s future and the value we see in our shares, our board has authorized an additional $110 billion for share repurchases. We are also increasing our quarterly dividend for the 12th year in a row.”

Apple’s tepid results come after a difficult start to the year for the company.

In addition to being under increasing pressure from low-cost Chinese rivals, the company faces scrutiny from antitrust regulators in the US and Europe and recently abandoned its decade-long project to build an electric car.

Meanwhile, Apple’s mixed reality headset, the Vision Pro, the company’s only new product since the launch of the Apple Watch in 2015, has yet to contribute significantly to sales.

The trendsetting company is also combating the perception that it is falling behind rivals such as Microsoft and Google in the race to develop and implement artificial intelligence (AI).

During a conference call on Thursday, Apple CEO Tim Cook sought to assure analysts that the company has AI products in development.

“We believe in the transformative power and promise of AI and believe we have advantages that will differentiate us in this new era,” said Cook.

“We will talk more about this in the coming weeks,” he added.