Apple Reports Growth In Gadgets And Services

Apple Inc. is showing it has life beyond the iPhone, reporting growth in other gadgets and services in the latest quarter that outweighed further pain in its bedrock business, reports The Wall Street Journal.

The tech giant reported revenue rose 1.8% in the September quarter to $64.04 billion, driven by rising sales of wearables including its smartwatch and services such as apps, streaming-music subscriptions and mobile payments. Those gains helped offset a 9.2% decline in iPhone sales, which have been falling for the past year.

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Profit fell 3% to $13.69 billion. That topped expectations but marked the first time since Chief Executive Tim Cook took over in 2011 that Apple’s profit has declined in all four quarters of a fiscal year. The company’s operating expenses have risen considerably since 2017 when it introduced a pricier new iPhone with facial-recognition technology and increased its spending on research and development. Revenue and profit for the fiscal year through September both edged down, their first annual declines since 2016.

Apple has responded to the challenge of a maturing smartphone market by accelerating sales of software, services and accessories across the 900 million iPhones in use world-wide. The company said sales of its services business rose 18% in the latest quarter, while sales in its wearables business soared 54% on the popularity of its AirPods wireless earbuds. The company is expanding on its entertainment push with the launch Friday of its new Apple TV+ streaming service.

In an interview, Chief Financial Officer Luca Maestri said Apple is on track for a strong Christmas sales season thanks to customer interest in the newest iPhones and the addition of new wearables, including a pricier version of AirPods that went on sale this week. He added that the company’s China business has improved considerably and said Chinese customers’ initial response to the new iPhones has been “very, very good.”