Apple's sales fall for the third consecutive quarter

Apple said Thursday that its revenue slipped 1% to $81.8 billion for its quarter ending July 1, marking the third consecutive year-over-year drop in quarterly revenue for the world's most valuable company.

There were some bright spots, however. The company said its services revenue reached a new all-time high of $21.1 billion. The services business - which includes Apple Music and Apple TV+ - is an increasingly important revenue driver for Apple.

Moreover, Apple's results narrowly beat Wall Street's estimates for revenue and profit.

iPhone revenue came in at $39.7 billion for the quarter, marking an approximately 2% year-over-year decline. Mac revenue was $6.8 billion for the quarter, a 7% drop, and iPad revenue was down nearly 20%.

Shares of Apple ticked down by more than 1% in after-hours trading Thursday. But the stock has climbed some 50% from the start of the year.

In a statement accompanying the earnings results, CEO Tim Cook touted the rosy services figure and strong performance in emerging markets.

"We are happy to report that we had an all-time revenue record in Services during the June quarter, driven by over 1 billion paid subscriptions, and we saw continued strength in emerging markets thanks to robust sales of iPhone," Cook said.

On a call with analysts Thursday, Cook added, "We continue to face an uneven macroeconomic environment, including nearly four percentage points of foreign exchange headwinds."

"Looking ahead, we'll continue to manage for the long term, always pushing the limits of what's possible and always putting the customer at the center of everything we do," Cook said.

Apple's June quarter is typically the slowest of the year for the tech giant, which usually unveils new iPhone models in September. Customers often hold out on upgrading until the new models are released. The quarter also ends before back-to-school shopping and the December holidays.

The latest earnings report also comes as PC and smartphone sales slump, after an initial surge seen in the early days of the pandemic. Global PC shipments fell 16.6% last quarter, according to preliminary data from Gartner released last month. Worldwide smartphone shipments, meanwhile, dropped 7.8% last quarter compared to the same period the previous year, according to separate preliminary data from market research firm IDC last week.

This is a developing story. Please check back for updates.