Apple iPad decline continues with 19 percent drop in holiday quarter

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In contrast with Mac and iPhone performance, the iPad continued a long-term decline in Apple's first fiscal quarter of 2017, seeing shipments fall 19 percent year-over-year.

For the holiday quarter, iPad sales fell to just over 13 million units from more than 16.1 million in the year ago period, Apple revealed in official data released on Tuesday. Accordingly, iPad revenue was down 22 percent from just over $7 billion to about $5.5 billion.

With some exceptions, iPad sales have been shrinking for the past few years. Compared with the first quarter of 2015, in fact, the company shipped over 8 million fewer units.

The iPhone saw shipments of about 78.3 million during the most recent quarter, up 5 percent. Mac units were up 1 percent to just under 5.4 million. All told, the company hit record quarterly revenue of $78.4 billion.

In comments during an investor conference call on Tuesday, CFO Luca Maestri said sales were higher than expected, noting iPad captured 85 percent of the market for tablets costing more than $200. The company's earnings release further touted satisfaction and business adoption in a subsequent conference call.

Aside from the usual rosy commentary, iPad still dropped year-over-year. The likely reason is that Apple didn't refresh anything in the iPad lineup in the fall, except to add more storage to the Air 2 and Mini 4, and drop prices on 9.7- and 12.9-inch iPad Pros.

Apple is rumored to be saving major updates for later this year, preparing three new models: updated 9.7- and 12.9-inch tablets, but also a 10.5-inch device, possibly with a sharper display.

The 9.7-inch tablet is expected to get minimal changes, becoming a budget model. There's no indication that Apple plans to update the iPad mini. A second-generation Apple Pencil could have magnets and a pocket clip.