Apple announces buyback as iPhone sales drop

US tech giant Apple Inc reported a drop in iPhone sales during its fiscal second quarter, but earnings came in higher than analysts expected, while it pleased investors further with promises to return some of its humongous $257bn cash pile.

Apple shipped 50.8m iPhones in the first three months of 2016, below the 51.2m it recorded in the previous quarter, and also below the 52.27m expected from FactSet analysts.

The stock price of the Cupertino, California company fell almost 2% in after hours trading following the release of the results.

Despite the falling iPhone sales, Apple reported a 4.6% increase in its revenue to $52.9bn, as well as surpassing estimates on its profits. Earnings per share were reported as $2.10, in comparison with the $2.02 consensus forecast.

The company also revealed a 10.5% increase in its quarterly dividend to shareholders to $0.63 per share.

Apple, which has a cash pile larger than the UK and Canada combined, also announced $50bn of buy-backs.

Shares in Tim Cook's company fell almost 2% in after hours trading

With the latest version of its flagship phone expected later this year, the iPhone 8, Apple will hope that the drop in sales can be attributed to consumers waiting for the latest release.

"We are proud to report a strong March quarter, with revenue growth accelerating from the December quarter and continued robust demand for iPhone 7 Plus," CEO Cook said on Tuesday.

Analyst Ipek Ozkardeskaya from London Capital Group said that increased competition was having an effect on Apple's quarterly figures.

"Rising competition in China, which caused 14% decline in revenues from the world’s biggest emerging market, and Samsung's return to the race with its well-noted Galaxy S8, raises questions regarding the much expected iPhone 8's ability to foster a suitable revenue growth in the coming quarters," she said.