Rumours that the mighty iPhone might be experiencing a sales slowdown were confirmed yesterday (January 28th), with Apple reporting a combination of flat sales and a projected drop in revenue for the next quarter. For iPhone fans, that raises questions for future iterations of the handset – and might even signal the start of consumers moving away from Apple towards alternatives from other brands.
Of course, as yet, no-one knows how Apple will fare this year, and what the repercussions will be if sales remain uninspiring.
What we do know is Apple's current financial position, and what it believes will happen during the next few months. So, exactly where does the company behind the beloved iPhone stand?
It has reported the slowest growth in iPhone sales since the initial product launch in 2007. The company sold 74.8 million in its first fiscal quarter of the year (the three months until December 26th), compared to 74.5 million during the same period a year ago.
These virtually flat sales would be worrying enough on their own, but Apple has also stated that it expects sales to fall in the coming quarter. Similarly, it predicts its very first fall in revenues since the iPhone's launch.
Despite these disappointing sales and negative projections, the company actually recorded record revenue and net profit, totalling $75.9 billion (£53 billion) and $18.4 billion respectively in the three months to December 26th.
Chief executive officer Tim Cook said: “Our financial position has never been stronger.”
As iPhone sales made up close to 70 per cent of the company's revenue for the period, fears about demand for the handset plateauing and then petering out are concerning.
Plus, one of the current key markets for Apple is China, with demand for the handset still very much strong in the country. However, dampening this demand are economic difficulties, which are making life harder for Apple in what should be their most lucrative location, as people turn to more affordable, local firms instead.
This is particularly worrying considering China makes up approximately one-quarter of all Apple sales.
In the first quarter of the year, sales in Greater China climbed by just 14 per cent compared to the 70 per cent increase experienced during the same period the previous year.
This all comes at a time when speculation about the upcoming iPhone releases is a hot topic of conversation – and not all of it positive. Fans of the handset reacted badly to rumours that the iPhone 7 won't have the tradition 3.5 mm headphone jack, and signed a petition to have it included in their thousands.
Concerns have also been raised about the internal storage capacity of the model dubbed the iPhone se, with some commentators suggesting that this could be limited to just 16GB.
However, none of these rumours have been confirmed, and there has been positive speculation too. For instance, many commentators have welcomed the suggestion that the 5se would return to the smaller four-inch screen format.