iPhone Sales Shrunk for the First Time Since 2020

Services revenue growth is even more noticeable this year, as iPhone sales have actually dropped for the first time in this quarter since Q2 2020. That saw a 6.7% decrease in iPhone sales to $29 billion, down from $31 billion in Q2 2019.

At the time, several analysts believed that was due to the softer demand for the iPhone 11 lineup as many anticipated Apple’s release of its first 5G models later that same year.

It’s less clear what’s caused iPhone 15 sales to fall by 10.5% this time around, but it’s also possible fewer folks waited to upgrade last fall. The Q1 2024 “holiday quarter” saw a strong 6% growth compared to -8.2% in Q1 2023. Beyond North American shores, weak demand in China also didn’t help.

Still, Tim Cook told CNBC he feels good about China as Apple still beat expectations in that market by over $1 billion in iPhone sales, which became even more competitive in 2023. In a live segment on CNBC, Cook said that iPhone sales actually grew in China during the quarter, adding that “may come as a surprise to some people.”