- Declines were ‘across the product suite,’ Target CEO says
- Apple is due to release a next-generation iPhone in September
Apple Inc.’s sales of iPads, iPhones and other devices fell 20 percent at Target Corp. stores during the second quarter, confirming Apple’s struggles with a global slowdown in smartphone demand and waning interest in its out-of-date gadgets.
Apple has already forecast a third consecutive quarter of revenue declines, led by weaker sales of its top-selling product, the iPhone. Chief Executive Officer Tim Cook is facing growing competition in China from homegrown phonemakers, as well as saturation in developed markets. Some consumers may also be holding off on new electronics purchases, waiting for the seventh-generation iPhone and a revamped MacBook Pro to be released later this year.
Target CEO Brian Cornell said the weakness in Apple’s sales at the retailer was “across the product suite,” and that the company is putting plans in place to better capitalize on the new devices when they hit the shelves.
“Our guests come to us looking for those products,” Cornell said on a conference call to discuss earnings. “They’re looking for the newness and the innovation. We’re putting together plans with Apple and our merchandising teams to make sure we’re ready to take advantage of that in the back half of the year.”
Target’s electronics sales fell by at least 10 percent on a same-store basis, with about a third of the pressure driven by Apple. Target said traffic to stores was down, which affected sales in all of its merchandise categories.
Apple was little changed at $109.09 at 1:08 p.m. in New York. Target was down 5.6 percent to $71.26.
(A previous version of this story was corrected to remove release date for new iPad.)