Apple's iPhone sales down 17% as it shifts to more services

iPhone sales continue to sharply decline, according to Apple's earnings statement for its fiscal second quarter, though its stock and services business are up today.

Apple's iPhone revenue was down another 17% for the quarter ending on March 30, amounting to $31.05 billion. A year ago we saw iPhone revenue at $37.56 billion.

You can chalk continued upgrade resistance to newer, more expensive iPhones. The iPhone XS Max is Apple's most expensive phone ever, the 'budget' iPhone XR is still quite pricey, and the iPhone XS didn't change very much from the iPhone X.

New iPhone 11 rumors point to a triple-lens camera upgrade and ability to wirelessly charge other devices (like the new AirPods 2019), but Apple's isn't expected to offer a groundbreaking smartphone redesign.

How it's stemming iPhone bloodletting

Apple noted that price drops in certain countries did help it see some recovery, so its declines were "significantly smaller later in the quarter," according to CEO Tim Cook during today's Apple earnings call. 

Sadly, Apple no longer releases number for how many iPhone units it sells anymore. Its Mac sales saw a minor dip (Apple blamed on "processor constraints on certain models"), while iPad sales were up and its catch-all Wearables, Home and Accessories category saw a nice bump.

Services are what Apple is touting the most these days, and today's earnings call was no different. It's up to $11.45 billion from $9.85, which Apple touts as breaking new records for Apple Music, the App Store and Apple Pay.

The company just launched Apple News Plus and the forthcoming Apple TV Plus, and Apple Arcade are coming later in 2019. They'll join Apple Music in driving in subscription-based revenue.

"Service account for 20% of our March quarter revenue and one third of its gross profit dollars," according to Apple CFO Luca Maestri during the Apple earnings call.

Of course, Apple's iPhone revenue is still 2.8 times larger than its growing services category and it's becoming a perilous business to be in. Netflix spends about $15 billion on original content, HBO has titan shows like Game of Thrones, and Disney Plus is a waiting in the wings, launching November 12.