Apple heads for largest Q3 revenue drop since 2016 as iPhone sales slow

economictimes.indiatimes.com:

Apple is likely to report a dip in iPhone sales in the April-June quarter as shoppers held out for a new model in a slow economy, making it important for the company to detail how it is using artificial intelligence to augment growth, analysts said. The world's most valuable firm will wrap up Big Tech earnings on Thursday, with a likely 1.6% drop in total quarterly revenue, according to Refinitiv — its steepest drop in third-quarter revenue since 2016.IPhone sales likely fell more than 2% in the period, according to 24 analysts polled by Visible Alpha, compared with a near 3% increase a year earlier and a 1.5% rise in the quarter ended March.

The quarterly report could mark a break from an upbeat earnings season for the likes of Meta Platforms, Alphabet and Microsoft that have shown resilience in their cloud businesses and an uptick in digital ad sales. «Apple is not immune to general macroeconomic trends and will continue to set the pace (for the smartphone industry) for quite some time,» said Bob O'Donnell, founder of TECHnalysis Research.

With details about the new iPhone 15 expected next month — which could sport the more universally accepted USB-C port on some models — iPhone sales could get a small nudge in the July-September quarter, said analysts, who predicted a mixed bag of results for the period. Apple traditionally does not provide quarterly outlook, but analysts expect the company may elaborate how it is using AI to improve its upcoming products.

The company has so far avoided buzzwords like AI at its events, in a contrast with tech giants including Alphabet and Microsoft. Last month, Bloomberg News reported Apple has quietly built its own framework to create large language models known as «Ajax».