Bar­clays prof­its down

Tech gi­ant sees first drop in rev­enue in 13 years

7 Days in Dubai - - BUSINESS -

Ex­perts have said Ap­ple needs to weave its magic and pro­duce the next big thing if they want to com­bat fall­ing sales.

Ap­ple sold more than 51 mil­lion iPhones in the first three months of this year, 10 mil­lion fewer than dur­ing the same quar­ter a year ago.

As a re­sult, Ap­ple this week re­ported its first drop in quar­terly rev­enue in 13 years - and the first-ever year-over-year de­cline in iPhone sales.

The slide is putting more pres­sure on Ap­ple and CEO Tim Cook to come up with its next big prod­uct.

Cook, of course, has prob­lems many cor­po­rate bosses would kill to have. De­spite the de­cline in sales, Ap­ple man­aged to rack up $10.5 bil­lion in profit for the quar­ter.

“The fu­ture of Ap­ple is very bright,” Cook told an­a­lysts on a con­fer­ence call on Tues­day. How­ever, Ap­ple is bat­tling per­cep­tions that its latest iPhones aren’t that dif­fer­ent from pre­vi­ous mod­els, at a time when over­all smart­phone sales are slow­ing around the world. Ap­ple also sells iPads, Mac com­put­ers and other gad­gets, but nearly two-thirds of its $50.6 bil­lion in quar­terly rev­enue came from iPhones.

“They need to come out with that next great prod­uct,” said An­gelo Zino, a fi­nan­cial an­a­lyst with S&P Global Mar­ket In­tel­li­gence. Zino said that while he is op­ti­mistic about the com­pany’s fu­ture, “Ap­ple ab­so­lutely needs to start di­ver­si­fy­ing their rev­enue base.”

Over­all, the com­pany’s rev­enue in the Jan­uary-March quar­ter was down 13 per cent from a year ear­lier. And the com­pany sur­prised an­a­lysts by fore­cast­ing an­other rev­enue drop of 13 per cent or more in the cur­rent quar­ter.

Ap­ple hasn’t re­ported a year-over-year sales de­cline since 2003, when the iPhone didn’t even ex­ist. Bar­clays plc has re­ported a 7 per cent fall in first-quar­ter prof­its, dragged down by busi­nesses it in­tends to sell. The bank said net in­come dropped to £433 mil­lion ($631 mil­lion) from £465 mil­lion in the same pe­riod a year ear­lier. Bar­clays says profit from its main busi­ness rose 53 per cent to £950 mil­lion. In his first full quar­ter as chief ex­ec­u­tive, Jes Sta­ley says the per­for­mance of Bar­clays’ core busi­nesses “shows the po­ten­tial power of the group once it is freed from the drag of non-core”. The bank re­vealed plans in March to split it­self into two and sim­plify its op­er­a­tions. The re­struc­tur­ing plan comes as the UK forces lenders to sep­a­rate riskier in­vest­ment bank­ing from re­tail op­er­a­tions. Such ring-fencing is meant to protect sav­ings in any fi­nan­cial crash.

PRES­SURE: Ap­ple CEO Tim Cook

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