Apple Q3 2016 Earnings: iPhone Sales Down, Again

The iPhone sales decline is real: For the second quarter in a row, Apple has sold fewer iPhones than a year ago. Apple sold a total of 40.4 million iPhones during its fiscal Q3 of 2016, which ended on June 30. During the same quarter last year, the company was still able to sell 47.5 million iPhones.

Apple announced these numbers as part of its Q3 earnings release Tuesday, which were in line with muted investor expectations.

During the most recent quarter, Apple generated revenue of $42.4 billion compared with $49.6 billion during the same quarter last year. Net profits came in at $7.8 billion, compared with $10.7 billion a year ago. This equals earnings per share of $1.42, compared with $1.85 for fiscal Q3 of 2015.

Analysts had expected earnings per share of $1.40 and revenue of $42.2 billion. The fact that Apple beat expectations on earnings gave its stock a 5 percent boost in after-hour trading.

These results follow a pretty bleak second quarter, and things don’t necessarily seem to get better for Apple: The company’s guidance for its fiscal fourth quarter, which will end on September 30, forecasts revenue to come in between $45.5 billion and $47.5 billion, compared with $51.5 billion during Q4 of 2015.

Popular on Variety

A continuing bright spot for Apple is its services business: The company generated close to $6 billion in revenue with Apple Music and other services during the most recent quarter, compared with around $5 billion a year ago. This means that services are now Apple’s second-biggest revenue driver, ahead of both Mac and iPad sales.

Apple’s China business on the other hand continues to be a sore spot. Revenue in greater China declined 33% year-over-year. Still, Apple CEO Tim Cook said during the company’s earnings call that he remains “very encouraged about growth prospects” in China as well as India. Apple generated close to $40 billion during the first three quarters of its current fiscal year in China, Cook said.

Cook also hinted at bigger plans for Apple TV: One shouldn’t confuse the current-generation Apple TV with Apple’s plans for the living room, he argued. “Think of that as sort of building the foundation for what we believe can be a broader business over time.”

Apple doesn’t break out sales of Apple TV, but lumps the device together with Apple Watch, iPod and other device sales. That category declined 16 percent, generating a total of $2.2 billion in revenue.

More Digital

  • Jake Paul

    YouTuber Jake Paul Launches Entrepreneur How-To Platform, Financial Freedom Movement

    YouTuber Jake Paul wants you to be financially free, for $19.99 a month.  At a rally on Saturday, the content creator — along with influencer friends and around 50 teenage and tween-age fans, some chaperoned by parents — launched the Financial Freedom Movement (FFM) in partnership with GenZ Holdings Inc., a Los Angeles-based brand development [...]

  • HQ Trivia

    HQ Trivia Live Game App Shuts Down

    After a two and a half years, HQ Trivia — the live game-show app that gave away cash prizes to winners — is shutting down. HQ Trivia’s move to shut its doors was first reported by CNN. The company is laying off its 25 full-time staffers, according to the report. In a tweet Friday, CEO [...]

  • Golden Mics - The Podcast Academy

    The Oscars of Podcasting? First 'Golden Mics' Awards to Debut in 2021

    The burgeoning podcast biz is looking for its own version of the Oscars, Emmys and Grammys. On Friday, a group of podcast publishers and producers including Spotify, NPR, PRX, Sony Music Entertainment and Wondery announced the formation of the Podcast Academy, a membership-based organization dedicated to promoting the medium. As part of its charter, the [...]

  • Mike Bloomberg

    Mike Bloomberg's Odd Meme Blitz Spurs Instagram to Require Influencers to Disclose Paid Political Content

    A new paid meme campaign on Instagram by billionaire Mike Bloomberg, who’s running a guerrilla bid for the 2020 Democratic presidential nomination, has prompted Facebook to clarify that influencers on the platform must disclose such arrangements. This week, Bloomberg’s presidential campaign launched a broad campaign across at least 19 top Instagram accounts with a collective [...]

  • Disney+ on Roku

    Roku Takes Credit for Being 'Important' Part of Disney Plus's Booming Q4 Signups

    Roku, in announcing strong 2019 holiday-quarter results, gave a bit of a flex in claiming it was a key part of Disney Plus reeling in 26.5 million customers in Q4. CEO Anthony Wood, on the company’s earnings call Thursday, gave props to Disney for blowing past Wall Street expectations with the new streaming service in [...]

More From Our Brands

Access exclusive content