Apple's iPhone sales fall for 1st time

Apple reported its first year-over-year quarterly decline in sales of the iPhone, its dominant product, as the company reported second-quarter results on Tuesday.

The company said it sold51.2 million iPhonesin the quarter, down from 61.2 million in the same quarter a year ago. Despite the drop, the result was still above the forecasts of analysts, who had been expecting Apple to report iPhonesales ofabout 50 million units.

Overall, Apple reported revenue of $50.5billion US, down from$58 billion a year earlier. Apple had not seen a revenue drop since 2003. Sales of iPhones accounted for 65 per cent of Apple's revenues in the quarter that concluded at the end of March.

Troy Crandall, equity analystat 3Macs in Montreal, said the year-over-year sales comparisons for the iPhone were "tough" because last year's figures included the initial sales ofthe iPhone 6 and 6 Plus.

The company said it made a profit of $1.90 per share, a drop from the $2.33 it made in the same quarter of last year. Analysts had been expecting the company to make $2 a share.

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Apple also offered a softeroutlook for the third quarter. The Cupertino, Calif.-based company said it expects to report revenues between$41 billion and $43 billion. Wall Street's consensus forecast was for$47.3 billion.

In the wake of the earnings news, investors sent Apple shares down more than eightper cent.

Apple said it sold 10.25 million iPads during the most recent quarter, a drop of 19 per cent.

One relative bright spot was Apple's services group, includingiTunes, the App Store, andApple Music. Services revenue was up 20 per cent year-over-year. Apple Music's subscriber base grew by 2 million during the quarter to reach 13 million.

The company also announced an increase to its capital return plan, which includesdividends and share repurchases, by $50 billion US. Apple said it now plans toreturn $250 billion US to shareholders by the end of March 2018.