End of the road for Apple’s growth streak

Apple’s streak of 51 consecutive quarters of uninterrupted sales growth is over - and its expansion may not resume until late this year.
A boom in demand for smartphones, music players and other electronic devices propelled Apple’s annual revenue by US$227 billion in the 13 years since the last quarterly drop, resulting in a skyrocketing stock price that made Apple the world’s most valuable company.
That era of untrammelled expansion hit a wall in the quarter that ended in March as fewer people upgraded to the latest iPhones, and the company is predicting another decline in the current period.
With the introduction of a new model still months away, Apple investors are seeking answers on whether lacklustre sales of the device, the company’s biggest revenue generator, reflect a broader slowdown in the market for high-end smartphones - or just the pause before the next upgrade frenzy.
Forecasts from suppliers such as Qualcomm and Taiwan Semiconductor Manufacturing have suggested demand is cooling, and stalled economic growth in China is paring Apple’s sales in that region.
“I see nothing on the horizon from a component or a technology perspective that’s going to drive these major upgrades,” Bob O’Donnell, chief analyst at TECHnalysis Research LLC, said in a televised interview on Bloomberg West.
“We’re going to see people hold onto these things longer, just like we saw with PCs.” Second-quarter sales slid 13% to US$50.6 billion from US$58 billion a year earlier, the company said Tuesday in a statement.
That compared with the average analyst estimate of US$52 billion.

NAMPA/AFP