The company, famed for throttling batteries on its expensive gadgets iPhone, reported a profit of €23.6 billion ($25.26 billion) on €90.8 billion (around $97.16 billion) in revenue for the first quarter of this year.
Rather than channelling funds into innovation, the company opted to repurchase shares from the market, a move designed to artificially inflate its stock price without the need for any real effort. This strategy seemed to pay off, as Apple's share price rose by six per cent to €183.20 ($196.02) in after-hours trading.
As anticipated, iPhone revenues took a hit due to increased competition from Huawei and market pressures from China. Despite being barred from using advanced Western technology, Huawei has managed to produce smartphones that outperform and undercut Apple's offerings in terms of cost.
Apple disclosed that its iPhone revenue fell to €45.7 billion ($48.90 billion), a ten per cent decrease from €51.3 billion ($54.89 billion) in the same period last year. In the crucial Greater China market, iPhone revenue shrank to €16.4 billion ($17.55 billion) from €17.8 billion (equivalent to $19.04 billion ), according to the earnings report. Huawei's first-quarter profits soared, further encroaching on Apple's market share.
Counterpoint's senior research analyst Ivan Lam noted that Jobs' Mob's sales suffered throughout the quarter as Huawei's resurgence significantly impacted Apple in the premium segment.
Adding to Apple's woes, Samsung regained its status as the world's top smartphone seller in the first quarter of the year, as reported by the International Data Corporation.
Amidst the intensifying competition, Apple continues to push for growth in revenue from services and digital content sold to its loyal customer base. However, this strategy is under threat from regulators and app developers who accuse Apple of monopolistic practices due to its stringent control over the App Store and device operating systems.
The US Department of Justice has launched a legal battle against Apple, accusing the company of illegally maintaining a monopoly over its iPhone by stifling competition and imposing excessive costs on consumers.
Apple has countered the lawsuit, claiming it is "wrong in both facts and law, and we will vigorously defend against it."
Meanwhile, the EU is investigating whether the App Store allows developers to offer promotions to consumers for free, outside of the marketplace.
Apple has lagged in integrating artificial intelligence into its products, a field where rivals Google and Microsoft have been actively innovating. Apple has remained secretive about its plans for AI but has assured that it will eventually integrate generative AI into its technology.
In hardware, Apple's recently launched Vision Pro "spatial reality" headgear has not made a significant impact, and Forrester's principal analyst Thomas Husson has advised his clients that it is unlikely to affect the company's financial performance in the foreseeable future.