IPhone sales slow, but it’s good times for the Apple Watch

JUST as Apple’s iPhone may finally be losing its appeal, the technology giant looks to have to become the second biggest watch-maker in the world.

Sales of the iPhone dropped to 50.8million in the first three months of this year – the second year in a row. A year earlier, it shipped 51.2million handsets and in 2015 that figure was 61.1million.

But the company reported record sales of its Apple Watch, pictured, in the first three months of this year. Apple chief executive Tim Cook claimed ‘we couldn’t be more satisfied’ with sales of around £4.5billion a year – second only to Omega owner Swatch for watches.

Yesterday, analysts warned iPhone customers were holding on to their handsets for longer, instead of upgrading them every year. And they said that other mobile manufacturers like Samsung and Huawei had improved their products so much, they were giving Apple a serious run for their money.

‘They have definitely closed the gap,’ said Ben Wood, a technology analyst at the research firm CCS Insight.

Mr Cook tried to explain away the slump by claiming that customers were simply holding out for the iPhone Apple will launch later this year.

The company traditionally unveils a new iPhone every September. This year, it is expected to mark the tenth anniversary of the device by launching a specialedition handset with an all-glass body, a curved screen and no ‘Home’ button at the bottom. Analysts said there was likely to be some truth to Mr Cook’s explanation.

Clement Thibault, senior analyst at Investing.com, said: ‘This is a very mixed report in terms of results, but the possibility of consumers holding out until the new iPhone release is very real, especially when the upgrade is rumoured to be more meaningful than in previous years.’

Overall the company’s sales were up 4.6 per cent on the same period last year to £41billion worldwide.