iPhone sales drop just before 10th anniversary
The iPhone turns 10 this year in June.
However, Apple surprisingly sold fewer iPhones in the first three months of 2017 than it did in the same period a year back.
Apple said that it sold 50.8 million iPhones, down by 1% compared to 2016.
Apple CEO Tim Cook blamed the drop in sales on a "pause" as customers wait for the next iPhone.
Revenue from iPhone sees a sharp decline
Analysts at GlobalData Retail observed that Apple's revenue earned from iPhone was $7 billion short of what it used to be in the same period two years back.
Apple, however, registers an increase in revenue
The drop in iPhone sales was also accompanied by a 2% decrease in the value of Apple's stock.
Meanwhile, Apple services like iCloud, Apple Pay, and the App Store recorded an 18% increase in sales.
The company also saw an increase in sales of gear like the Apple Watch and AirPods.
Apple registered an overall 4.6% increase in its revenue to $52.9 billion.
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Apple's profits look healthy
Despite disappointments, Apple announced that its quarterly profits were $11.4 billion worldwide - an improvement of 4.9% compared to the same period in 2016.
High expectations on Apple's 10th anniversary iPhone
While Apple is seeing sales in its other products, the company's health realistically depends upon the sales of its flagship product - iPhone.
With the 10th anniversary of the iPhone upon us, expectations are high, and anything short of an impressive improvement to the iPhone is bound to leave investors/customers unhappy.
Long story short, Apple needs its 10th anniversary iPhone to be a blockbuster.