Apple Inc.’s (NASDAQ: AAPL) disappointing earnings proved that the company’s run as a growth stock is over for now. Quarterly revenue dropped 4% year over year to $90.8 billion. Earnings were flat at $1.53 per share.
Investors were particularly disappointed by the decline in iPhone revenue, from $50.3 billion to $46.0 billion. Another smaller division also had a poor quarter. Revenue in the Wearables and Home Division dropped from $8.6 billion to $7.9 billion.
“Wearables” include the Apple Watch, iPods, and Air Tags. To some extent, these are tied to iPhone sales. They mostly work with the iPhone, though the Apple Watch is a standalone product when configured separately. When the Apple Watch was launched in April 2015, it was supposed to be another Apple “breakthrough” product. It was newer than the iPhone, iPad, and Mac. It comes in several sizes and colors and is sold at price points from $249 to $1,249.
Did the Apple Watch fail to catch on? Apple does not break out figures. Perhaps slow iPhone sales pulled down its smartwatch sales as well. Perhaps it is too niche a product. Or perhaps the slow sales are because of several competitors, particularly from Garmin, Coros, Polar, Samsung, and Google.
One thing is for certain. There is no product to save Apple other than the iPhone. The Apple Watch joins other products that did poorly last quarter. And none of them has shown enough growth in the previous several years to be an engine to help the entire company.
See how much money Apple makes every minute.
It’s Your Money, Your Future—Own It (sponsor)
Are you ahead, or behind on retirement? For families with more than $500,000 saved for retirement, finding a financial advisor who puts your interest first can be the difference, and today it’s easier than ever. SmartAsset’s free tool matches you with up to three fiduciary financial advisors who serve your area in minutes. Each advisor has been carefully vetted and must act in your best interests. Start your search now.
If you’ve saved and built a substantial nest egg for you and your family, don’t delay; get started right here and help your retirement dreams become a retirement reality.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.