\n<\/p>\n
Apple\u2019s latest earnings were a mixed bag, with slipping iPhone sales countered by rising revenue.<\/p>\n
Reporting after the bell Thursday, the iPhone maker\u2019s overall revenue in the first quarter of 2025 beat Wall Street expectations, with a 4% bump to $124.3 billion over the same time last year. <\/p>\n
Apple reported net income of $36.33 billion, up 7.1% from $33.92 billion in the same year-ago period.<\/p>\n
The increase came even as the company missed iPhone estimates, with an 11.1% sales drop in China knocking revenue down to $18.51 billion. It\u2019s the largest drop in this key region since a nearly 13% dip in Q1 2024.<\/p>\n
The world\u2019s largest smartphone market has proven increasingly difficult for the company, owing to more intense competition from domestic manufacturers, including Oppo and Vivo. Huawei, which saw a massive drop in sales as trade restrictions were imposed by the first Trump administration, has since surged in its home country.<\/p>\n
In a conversation with CNBC<\/a>, CEO Tim Cook placed some of the blame at the feet of Apple Intelligence \u2014 which isn\u2019t currently available in China \u2014 along with several other key markets. Apple\u2019s small model generative AI platform is, by far, the biggest selling point for the iPhone 16, which debuted late last year.<\/p>\n \u201cDuring the December quarter, we saw that in markets where we had rolled out Apple intelligence, that the year-over-year performance on the iPhone 16 family was stronger than those markets where we had not rolled out Apple intelligence,\u201d Cook said.<\/p>\n The AI platform is currently available in English (Australia, Canada, Ireland, New Zealand, South Africa, U.K., and U.S.). Chinese is among the languages coming later this year, but Apple has yet to announce whether the feature will ultimately arrive in mainland China.<\/p>\n Regulatory approval and security restrictions are among the issues standing between Apple Intelligence and a China rollout. The company reportedly teamed up with domestic internet giant Baidu to add AI features to iPhones in the country. But that deal has apparently hit its own roadblocks<\/a>.<\/p>\n Cook also pointed to channel inventory, which has restricted the availability of new hardware in the country.<\/p>\n iPhone sales declined slightly year-over-year, in spite of the company\u2019s anticipation of an Apple Intelligence-driven boost. The platform experienced a slow rollout in iOS 18, with features arriving in waves. Some features like news summaries had a rocky launch as well. Apple paused the feature<\/a> to address an issue with surfacing incorrect information.<\/p>\n Both Mac and iPad revenue grew by 15% for the quarter, thanks to the launch of a new iPad Mini, iMac, Mac Mini, and MacBook Pro. Services \u2014 which includes things like Apple TV+, Apple Music, and iCloud \u2014 saw 14% growth for the quarter.<\/p>\n All told, the company now has an install base of 2.35 billion active devices, up from 2.2 billion the same time last year. Cook also noted that Apple now boasts 1 billion subscriptions across its content offerings and third-party apps.<\/p>\n Overall, analysts are greeting the news positively, as the company beat expectations in several key categories despite headwinds. Earlier this week, Apple\u2019s late entry into the generative AI space also shielded the company<\/a>, as the arrival of DeepSeek R1\u2019s platform resulted in a large buy-off for companies like Nvidia.<\/p>\n<\/div>\n