Apple's Sales Slump Continues Despite Beating Expectations

Despite beating Wall Street sales and profit targets in the fiscal third quarter, Apple shares dropped about 2% as the company forecasted a continuing sales slump into the current quarter. While the profit beat was driven by strength in services, weaker than expected sales of the iPhone disappointed investors. Apple executives expect iPhone sales to improve in the fourth quarter but did not provide specific details. The company's research and development spending has increased, particularly in the field of generative artificial intelligence. Apple's sales in China outperformed the overall smartphone market, with iPhone sales growing by "double digits" and strong performance in other segments. The services segment, including Apple TV+, had higher revenue than expected, and Apple now has 1 billion subscribers on its platform.