Apple shares fall as iPhone sales take a surprise dip

Apple shares fall

Apple Inc. reported a surprise fall in iPhone sales for its second quarter on Tuesday, indicating that customers may have held back purchases in anticipation of the 10th-anniversary edition of the company's most important product later this year.

Apple boosted its capital return program by $50 billion, increased its share repurchase authorization by $35 billion and raised its quarterly dividend by 10.5 percent as the company was under pressure from shareholders to hand over more of its $250 billion-plus hoard of cash and investments.

Investors were unmoved, sending shares of the world's most valuable listed company down 1.9 percent at $144.65 in after-hours trading.

Apple sold 50.76 million iPhones in its fiscal second quarter ended April 1, down from 51.19 million a year earlier.

Analysts on average had estimated iPhone sales of 52.27 million, according to financial data and analytics firm FactSet.

Despite the dip in unit sales, iPhone revenues rose 1.2 percent in the quarter, helped by a higher average selling price.

10th Year Anniversary

Expectations are building ahead of Apple's 10th-anniversary iPhone range this fall, with investors hoping that the launch would help bolster sales.

Apple typically launches its new iPhones in September.

A big jump in sales usually follows in the holiday quarter, before demand tapers over the next few quarters as customers hold back ahead of the next launch.

Apple's 10th-anniversary iPhone range might sport features such as wireless charging, 3-D facial recognition and a curved display.

Apple's gross margin hit 38.9 percent, slightly ahead of analysts' average expectation of 38.7 percent, despite higher prices for memory chips. The company said it expects gross margins next quarter between 37.5 percent and 38.5 percent, versus analysts' expectation of 38.3 percent.

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