Apple sales dropped at the end of 2022 as shoppers squeezed by the rising cost of living cut back their purchases.
Sales at the iPhone giant fell 5% in the three months to December compared with the same period in 2021.
It was the biggest decline since 2019 and worse than expected.
The update came as many firms warn about a sharp economic slowdown, especially in the tech sector which boomed during the pandemic.
Apple boss Tim Cook said the firm was navigating a “challenging environment”.
He blamed the sales decline on supply shortages due to Covid-19 disruption in China – where its phones are manufactured – and a strong dollar, as well as wider economic weakness stemming from rising prices, the war in Ukraine and lingering effects from the pandemic.
“As the world continues to face unprecedented circumstances … we know Apple is not immune to it,” he said on a conference call with investors.
Apple said the decline in sales occurred throughout the world and hit most of its products.
Sales of its popular iPhones were down more than 8%, and sales of Mac computers dropped 29%.
The declines hit the firm’s profits, which fell 13% to $30bn (£24bn).
Roger McNamee, founding partner of Elevation Partners, told the BBC’s Today programme that the biggest issue facing Apple was its supply chain in China.
“China has taken a more combative approach with Western economies over the past year and a half, partly due to their zero tolerance on Covid but I think there are other geopolitical issues factoring in as well and Apple, which has historically done the vast majority of its manufacturing in China, has had supply chain issues,” he said.
“It is unclear to what degree Apple may have demand problems. It is super-clear they can’t get all the supply that they want to get.”
Paolo Pescatore, analyst at PP Foresight, said Apple, like many electronics makers, was also struggling to make the case that users should upgrade given “what is perceived to be incremental improvements on previous models”.
“More so when everyone is tightening their belts,” he added.
Source: BBC News
