Apple has reported a 3% year-on-year drop in revenue in the first quarter of 2023, to $94.8bn, marking a second consecutive quarter of declining sales. The company had warned investors that sales could fall by as much as 5% in the January-March period due to a challenging macroeconomic environment. Apple’s profits also declined by more than 3% year-on-year to $24.2bn, which was better than expected, and profits were buoyed by a 1.5% year-on-year increase in iPhone sales to $51.3bn – a record for the quarter.

Apple’s services unit saw sales rise 5% year-on-year to more than $20bn. In Europe, sales rose more than 2%, but in the Americas, the company’s biggest market, sales fell more than 7%. Apple CEO Tim Cook highlighted growth in India, where the firm is investing heavily and which he visited last month to open the company’s first two official stores in the country. The iPhone maker said that it saw big growth opportunities in India as the country’s middle class expands, saying the country was at a “tipping point”.

Apple’s results indicate that the company is experiencing a slowdown in sales amid a challenging economic environment, which has prompted consumers to delay purchases of computers and iPads. However, the company has benefited from strong demand for iPhones, especially in south Asia and Latin America.

Despite the decline in overall sales, Apple’s performance was better than expected, which was also reflected in updates from other tech giants, including Facebook-owner Meta and Alphabet, parent company of Google. Apple’s continued investment in India reflects the company’s determination to tap into new growth opportunities overseas. The performance of the iPhone is crucial to the company’s success, and its strong sales have helped to mitigate the impact of weaker demand for other products.