Apple falls 2 per cent as it posts 3rd straight quarter of year-on-year revenue declines

Apple falls 2 per cent as it posts 3rd straight quarter of year-on-year revenue declines

Apple reported quarterly earnings that topped analysts' estimates and revenue that was in line with expectations on Tuesday, as it saw better-than-expected iPhone sales.

But the quarterly results marked the third straight quarter where Apple posted a year-over-year revenue decline.

The iPhone maker reported earnings per share of US$1.67 (S$2.30) per share, just above the US$1.66 expected by a Thomson Reuters consensus estimate. Revenues came in at US$46.9 billion, just shy of the US$46.94 billion expected.

That's still down from the comparable year-ago figures of US$1.96 a share on sales of US$51.5 billion.

Shares rose briefly about 2 per cent in after-hours trading, but were last seen down more than 2 per cent.

With 45.5 million units, the company reported more iPhone sales than expected during the quarter. Apple was expected to report after the bell that it shipped 44.8 million iPhones.

Still, iPhone shipments fell 5 per cent, down from 48.04 million a year ago, according to analysts surveyed by StreetAccount.

It comes after Apple reported revenues of US$42.4 billion in the third quarter, down against the comparable year-ago figure of US$49.61 billion in revenue. In the second quarter, Apple reported US$50.56 billion in revenue, a roughly 13 per cent decline against US$58.01 billion in the comparable year-ago period.

"We couldn't be more excited about the customer response to the iPhone 7 and the iPhone 7 Plus," CEO Tim Cook said.

Apple's board also declared a cash dividend of 57 cents per share, payable on Nov. 10. During its first fiscal quarter, the company said it expects revenue in the range of US$76 billion to US$78 billion, beating the US$74.9 billion expected by analysts polled by StreetAccount.

Shares of Apple are down about 1 per cent over the past year, but up nearly 20 per cent in the past 3 months. As the main source of the company's revenue, iPhone sales are known to move the company's stock even more than earnings.

Apple's biggest stock pop after an earnings beat was from April 2012, on much stronger-than-expected iPhone sales, and Apple gained 8.9 per cent the next day, according to Kensho data.

Apple's biggest stock drop after an earnings and revenue beat was from January 2013 when iPhone sales missed expectations and the stock fell nearly 12.4 per cent, according to Kensho.

It comes on the heels of the company's latest phone, iPhone 7, which investors hope will turn around sliding iPhone sales in the holiday season.

The new iPhone has been promoted aggressively by wireless carriers, amid a massive recall of rival high-end phone, the Samsung Galaxy Note 7, over safety concerns.

Google, maker of rival operating system Android, has also released a new Pixel phone in time for the holidays. Apple is holding a press event on Oct. 27, where industry blogs expect it will reveal new Macs.

"It's going to be interesting: The next 6 to 12 months are pivotal for the industry," said Dan Ives, senior vice president of finance and corporate development at Synchronoss Technologies, a mobile cloud services platform.

"It speaks what type of pent up demand there is. Does Google become a player? Will Samsung get back on track? I think it's almost like a game of high stakes poker. You want to see where everyone's cards stand."

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