iPhone sees first ever year-over-year decline (but gaining ‘switchers’ and enterprise users)

For the second fiscal quarter of 2016, iPhone sales saw a year-over-year decline (the first ever), as the shipped 51.2 million units — down from 61.2 million a year earlier. That’s a dip of 18%.

In an interview with The Wall Street Journal Cook said it was “a challenging quarter” for the company. It struggled with tough comparisons on iPhone sales compared with a year earlier, when demand for the iPhone 6 and iPhone 6 Plus was booming. What’s more, demand for those models prompted some consumers to upgrade sooner than usual, and sapped interest in the latest phones, he said.”

On the bright side, Cook, in a call with analysts and the press, said the company saw more switchers to the iPhone from Android switchers and other handset manufacturers in the first six months of 2016 than at any time in Apple’s history. With 42% smartphone penetration, Apple is still attracting new customers, he added.

Cook says there’s “terrific customer” response to the iPhone SE. Demand has exceeded supply at this point, but “we’re working hard to meet demand,” he added.

Chief Financial Office Luca Maestri said Apple’s smartphone platform is making big gains in the enterprise market. He added that 78% of businesses planning to purchase smartphones in the June quarter will chose iPhone, according to a new ChangeWave survey.