First drop in iPhone sales, Apple revenue streak ends

Apple on Tuesday reported its first-ever drop in iPhone sales since launching the smartphone in 2007 as the tech giant's long streak of rising revenue ended.

Apple said iPhone sales dropped year-over-year for the first time, slipping to 51.19 million in the recently ended quarter compared with 61.17 million in the same period a year ago.

Profits fell as well: Apple reported net income of $10.5 billion in the fiscal quarter to March 26 from $13.6 billion last year.

With iPhones the main driver of sales for the company, revenue fell on a year-to-year basis for the first time since 2003: $50.6 billion from $58 billion a year earlier.

Apple shares dove 7.9 percent to $96.01 in after-market trades that followed release of the earnings figures.

Sales of iPhones, the heart of Apple's mobile age money making machine, were down 16 percent, according to the earnings report.

While Apple is the world's largest company by profit and market value, it has been shifting its focus in anticipation of the slowdown.

"Our team executed extremely well in the face of strong macroeconomic headwinds," said Apple chief executive Tim Cook.

"We are very happy with the continued strong growth in revenue from services, thanks to the incredible strength of the Apple ecosystem and our growing base of over one billion active devices."

Analysts said it was not surprising to see the drop given the saturation of the global smartphone market.

"Following a rapid expansion into new markets over the years from 2007-2011, Apple was approaching saturation of the available distribution channels, and many of those already in the smartphone market who could afford to buy an iPhone had one or one of its high-end Android competitors," said Jan Dawson at Jackdaw Research.

Dawson said Apple managed to boost sales in a slow-growing market with its large-screen models, but that it is unclear if it can regain momentum.

Apple also announced that its board has authorized $35 billion more to be spent on buying back shares, along with money for the dividend to be increased to 57 cents per share.

Apple has been making inroads into wearable technology with its Apple Watch and moving into services such as music subscriptions, but remains largely dependent on the iPhone for profit and revenue.

Twitter stung by stall in user growth
San Francisco (AFP) April 26, 2016 - Twitter shares nosedived Tuesday after a quarterly update showed little change in its user base and the messaging platform delivered weaker-than-expected revenue growth.

The company posted a loss for the first quarter of 2016 of $80 million, compared with a loss of $162 million in the same period a year ago. Revenues meanwhile jumped 36 percent year-over-year to $595 million.

But in a key metric in the fast-evolving social media world, Twitter's trend was flat. The number of monthly active users was 310 million, up three percent from a year ago and only slightly higher than the 305 million in the previous quarter.

Twitter changed the way it measures active users, no longer counting those who follow via SMS text messaging. The number reported in the fourth quarter including that group was 320 million.

Twitter shares skidded 12 percent at $15.64 in after-hours trading, extending their slump over the past two years.

Since its much-anticipated public offering in November 2013 at $26, Twitter shares saw a jump to $60 the following month but have been sliding since then.

Twitter's growth woes have led to the return of co-founder Jack Dorsey as chief executive, and he has promised new services in a bid to boost growth and user engagement.

"As we outlined last quarter, we're focused on what Twitter does best -- live," Dorsey said in a statement.

"Twitter has always been the best place to see what's happening now. Whether it's breaking news, entertainment, sports, or everyday topics, only Twitter lets you connect with people anywhere in the world with live conversation."

Dorsey added that "we made a lot of progress on product innovation this quarter, particularly with live video and our refined timeline, and people love it... We remain focused on improving our service to make it fast, simple and easy to use."

Dorsey has introduced a new "Moments" feature highlighting breaking news stories, and has been allowing users to see an "algorithmic" timeline that is designed to be better adapted to each person sending a tweet.

Twitter marked its 10th birthday last month, having become a powerful communication tool but still struggling to win users and reach profitability.

While Twitter has become a must-have tool for journalists, activists and celebrities, it has struggled to show it can expand beyond its devoted base to become a mainstream hit.