Apple is no longer a $3 trillion market cap company, as it’s facing the worst iPhone sales decline in over two decades. Its shares dropped 4.8% to $81.99 and the new market cap is $2.86 trillion.
On August 4th, the company posted its third-quarter business results with a straight decline in sales and it’s likely to remain slow throughout the entire quarter.
On a conference call, Apple’s Chief Financial Officer Luca Maestri predicted that the performance may not improve during the mentioned period and it would be the longest streak of declines in two decades.
In the third quarter, iPhone slipped 2.4% to $39.7 billion in the third quarter, compared with a $39.8 billion estimate.
The latest changes in earnings are blamed on current market conditions and slowed demand in smartphone consumers. Apple CEO, Tim Cook, stressed that sales would be up on an annual basis if the currency were held constant.
The current generation of iPhone begins to see a decline in interest, as Apple prepares to unveil iPhone 15 in September. This new lineup will bring substantial upgrades including a titanium frame, thinner borders around the screen, and a faster processor.
Apple has informed suppliers that it expects shipments of the device to remain flat with the year before through the balance of 2023, at about 85 million units.
On the earning call, Apple revealed iPad sales decline of 20% last quarter. It generated $5.79 billion, versus calls for about $6.33 billion.
Mac sales fell 7.3% to $6.84 billion, which topped an average estimate of $6.37 billion. Services revenue was a clear highlight, climbing 8.2% to $21.2 billion. That topped estimates of $20.8 billion. The growth was “driven by over 1 billion paid subscriptions,” Cook said.
Apple has a serious challenge ahead and the iPhone 15 could bring back the lost glory of its $3 trillion market cap, which it can no longer enjoy.