Apple has released its first quarter results, and things aren’t looking quite rosy for the Cupertino-based giant. While the services revenues have increased, iPhone sales have continued to decline, with profits falling 15 percent. Overall, Apple’s revenue was down 5 percent to around $84.3 billion compared to a year ago. While the economic slowdown in China was blamed as an issue, Tim Cook also said that customers were struggling with high prices of iPhones, causing a dip in sales.
In an interview with Reuters, Cook said some currencies experienced more drastic iPhone price increase. “When you look at foreign currencies and then particularly those markets that weakened over the last year those (iPhone price) increases were obviously more. And so as we’ve gotten into January and assessed the macroeconomic condition in some of those markets we’ve decided to go back to more commensurate with what our local prices were a year ago in hopes of helping the sales in those areas,” Cook said.
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During the company’s earnings call, Cook did mention that while US dollar gained strength, Apple products became more expensive around the globe. He used Turkey as an example, where lira depreciated over 33 percent in 2018, and in the past quarter, the revenue was down by nearly $700 million compared to the same quarter last year.
The newer iPhone models experienced the biggest price discrepancies in the emerging markets. Cook said, Apple is rethinking how it prices iPhones, and that it won’t track the US dollar price exactly. Instead, the company will set iPhone prices in local currency for every market. He further added that Apple will lower iPhone prices in certain markets outside of the United States.
However, Cook did not name the markets that will see iPhone price cuts. There is a chance where India may see iPhones getting a price drop, but we will have to wait and see if Apple officially announces it in the coming months.