Apple’s Q1 2023 earnings show first revenue decline in nearly 4 years

Apple on Thursday posted its first quarterly revenue decline since 2019, bringing in $117.2 billion which is down 5 percent year over year. Mac sales were hit particularly hard, down about 30 percent year over year. iPhone sales also dipped by roughly 8 percent.

Apple was expected to post a significant reduction in revenue for the quarter, which saw several factors weighing on the company’s sales. Most notably, there were weeks-long issues with iPhone 14 Pro and iPhone 14 Pro Max production that stretched over the important Black Friday rush and made the smartphones nearly impossible to find.

Additionally, Tim Cook blamed the strength of the U.S. dollar and “the challenging macroeconomic environment” as contributing factors. Indeed, prices for many Apple products have risen quite a bit outside the U.S., making them less affordable.

There were few bright spots for the company over the holiday quarter, but the iPad had its strongest quarters since 2014 and Services broke $20 billion for the first time:

• iPhone: $65.8 billion (Down 8 percent)
• Mac: $7.7 billion (Down 29 percent)
• iPad: $9.4 (Up 30 percent)
• Wearables: $13.5 billion (Down 8 percent)
• Services: $20.8 billion (Up 6 percent)

Cook also announced that Apple hit 2 billion active devices for the first time. Of note, over half of iPad customers and two-thirds of Apple Watch buyers were new to the platforms.

While revenue fell year over year, Apple is still wildly profitable, with quarterly net revenue of about $30 billion (down almost 14% year over year) and diluted earnings per share of $1.88. Apple declined to provide specific guidance for the March quarter, but chief financial officer Luca Maestri said the company expects year-over-year results to be “similar to the December quarter.”