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APPLE iPhone & Services Shine as Apple's Supporting Cast Slumps Citing currency headwinds and an "uneven macroeconomic environment", Apple reported its fourth consecutive quarter of declining sales on Thursday. The overall results were slightly better than expected, however, as record services sales and the highest-ever iPhone revenue for a September quarter partly glossed over lackluster Mac, iPad and Wearables sales. Total sales declined just 0.7 percent to $89.5 billion year-over-year, but without the positive impact of Apple's ever-growing services segment, the drop would have been steeper at 5.3 percent. In the conference call with investors, CFO Luca Maestri pointed out that overall sales grew on a constant currency basis, but that will likely not be enough to appease Wall Street, which has come to expect more of the same from Apple, meaning perpetual growth. iPhone sales, still at the heart of Apple's business, grew 2.8 percent to $43.8 billion in the September quarter, which is traditionally the second weakest in terms of iPhone sales as new models are typically released at the very end of the quarter. Meanwhile Mac sales dropped by 33.8 percent to $7.6 billion, a decline that Apple blames on "challenging market conditions", i.e. a broader slowdown in PC sales, and a tough comparison to last year, when pent-up demand had boosted sales after a period of constrained supply. iPad sales also saw another double-digit decline, reflecting weak demand for tablets following a pandemic growth spurt. Meanwhile Apple's services business was once again the star of the show, as it grew 16 percent to a new record of $22.3 billion, roughly 25 percent of the company's overall sales. "We achieved all-time revenue records across App Store, advertising, AppleCare, iCloud, payment services and video, as well as the September quarter revenue record in Apple Music," Tim Cook said in a conference call with investors, touting the variety in Apple's service offerings. "We have well over 1 billion paid subscriptions across the services on our platform, nearly double the number we had only three years ago," Maestri added. Looking ahead, Apple warned that the holiday quarter will have 13 weeks instead of last year's 14 weeks, meaning that the company faces an uphill battle in even matching last year's results, which it is still aiming to do. While iPhone and services revenue are expected to continue to grow, the Mac segment is also forecast to do significantly better on a year-over-year basis then it did this quarter. The same cannot be said for iPad and Wearables, which are expected to decelerate significantly, due to different timing of product launches making year-over-year comparisons unfavorable. By Felix Richter Statista.com