Apple reports first annual revenue decline in 15 years

Apple's yearly revenue drops for first time since 2001

Apple has recorded sales drops for both its fourth quarter and full financial year - its first year of declining annual revenue since 2001.

For the three months ending 24 September 2016 Apple's revenue was down nine per cent year on year to $46.9bn (£38.4bn).

For the full financial year revenue was down 7.7 per cent to $215.6bn - the first decline the vendor has seen since 2001.

Apple's primary income, the iPhone, saw shipments fall five per cent year on year to 45.5 million in Q4, while iPhone revenue fell 13 per cent to $28.2bn.

Richard Holway, chairman of TechMarketView, slammed Apple for its lack of creativity since the Steve Jobs era.

"CEO Tim Cook is beginning to sound like a broken record," he said referring to Cook's claim he was "thrilled" by the response to the iPhone 7.

"Goodness knows what words he will use if Apple actually gets another hit on its hands. After all, the Apple Watch seems to be a bit of a dud sales-wise.

"And that is really the point. Since 2001, when Apple introduced the iPod, we have all enjoyed a string of the most innovative products including the iPhone and the iPad. But with Steve Jobs gone, so it appears has that wondrous seam of inventiveness. Can Apple get its mojo back? On current form one would doubt that."

Not all analysts were as negative about Apple's declining sales, with Ben Wood, chief of research at CCS Insight, pointing out that Apple is unlikely to see its position as the world's number one device manufacturer under threat any time soon.

"This is an unrepresentative quarter in Apple's trajectory," Wood said, prior to the results announcement.

"Some reports will focus on Apple having a weak quarter which ignores the fact that it continues to be the most profitable device maker on the planet and there seems little evidence that will end any time soon."

Despite the sales declines, Apple lauded its services arm - encompassing the likes of Apple Pay, Apple Music and AppleCare - which saw its quarterly revenue increase 24 per cent year on year to a company high of $6.3bn.

Daley Robinson, marketing director at Apple partner Stone Group, told CRN that there is an opportunity for the channel to take advantage of the services Apple has to offer.

"There certainly seems to be a lot of development in that area," he said.

"They're a great brand with a great credibility in producing services of great value so there is no reason why that wouldn't continue to be something that channel firms can exploit in the future."

Robinson went on to explain that Stone has seen some "dramatic changes" in Apple's channel attitude, which he said demonstrated Apple's commitment to the channel.

He singled out Apple's university framework, on which Stone is joined by XMA, Academia and Insight.

Academia CEO Mike Bacon added that the framework is a sign that Apple has become more channel friendly.

"Apple had taken the UK university business direct for 10 years in a row and for the first time they've opened it up to resellers.

"Looking back, we're four or five months in and its going incredibly well.

"The customers are happy because they're getting the added-value services [and] as a reseller Academia is very pleased with the performance. We're getting more than our fair share."