Apple sold fewer iPhones than a year ago in the first three months of 2017, the company said in its latest results.
The California firm, which is due to release a new phone later this year, said it sold 50.8 million iPhones in the period, down 1% year-on-year.
Apple boss Tim Cook blamed a “pause” as customers wait for the next iPhone.
Shares in the firm fell nearly 2% in after-hours trading after earlier hitting a record high on expectations of better results.
Apple reported a 4.6% rise in revenue across the whole company to $52.9bn (£41bn), slightly below analysts’ forecasts.
The dip in iPhone sales was offset by services, including Apple Pay, iCloud and the App store, which recorded an 18% increase in sales to $7bn.
Cook also pointed to growth in sales of Apple Watch, as well as its AirPods and Beats earphones.
Despite falling unit sales, revenue from iPhones still climbed 1% to $33.2bn due to “robust” sales of its bigger, more expensive iPhone 7 Plus.
Analysts at GlobalData Retail noted that Apple’s revenue from iPhones was $7bn less than the same period two years ago.
“We highlight these facts not to be unduly harsh to Apple, but to indicate that the company has only partially emerged from the slump that hit it over the last fiscal year,” Neil Saunders, managing director of GlobalData Retail, wrote in a note.
“In our view, the company’s mature product line up and an absence of any significant new devices mean it has struggled to regain all of the lost ground,” he added.
China, which was partly to blame for the slowdown last year, was again difficult for Apple. Revenue from China dropped 14%, although Cook partly blamed currency fluctuations for the fall, reports the BBC.
Apple said quarterly profits were $11bn worldwide, up 4.9% from the same period in 2016.
The firm also announced it would return an extra $50bn to shareholders.
The California firm, which is due to release a new phone later this year, said it sold 50.8 million iPhones in the period, down 1% year-on-year.
Apple boss Tim Cook blamed a “pause” as customers wait for the next iPhone.
Shares in the firm fell nearly 2% in after-hours trading after earlier hitting a record high on expectations of better results.
Apple reported a 4.6% rise in revenue across the whole company to $52.9bn (£41bn), slightly below analysts’ forecasts.
The dip in iPhone sales was offset by services, including Apple Pay, iCloud and the App store, which recorded an 18% increase in sales to $7bn.
Cook also pointed to growth in sales of Apple Watch, as well as its AirPods and Beats earphones.
Despite falling unit sales, revenue from iPhones still climbed 1% to $33.2bn due to “robust” sales of its bigger, more expensive iPhone 7 Plus.
Analysts at GlobalData Retail noted that Apple’s revenue from iPhones was $7bn less than the same period two years ago.
“We highlight these facts not to be unduly harsh to Apple, but to indicate that the company has only partially emerged from the slump that hit it over the last fiscal year,” Neil Saunders, managing director of GlobalData Retail, wrote in a note.
“In our view, the company’s mature product line up and an absence of any significant new devices mean it has struggled to regain all of the lost ground,” he added.
China, which was partly to blame for the slowdown last year, was again difficult for Apple. Revenue from China dropped 14%, although Cook partly blamed currency fluctuations for the fall, reports the BBC.
Apple said quarterly profits were $11bn worldwide, up 4.9% from the same period in 2016.
The firm also announced it would return an extra $50bn to shareholders.
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