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| Apple: Downhill from here? |
While it's fair to say the firm is still a long way from the breadline - it has around $200bn in offshore reserves alone - many see the news as a sign that the winning formula it has upheld for so long is no longer enough.
So where next for the billion dollar business? The BBC asked the experts.
The industry analyst
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Ben Wood from CCS Insight specialises in scrutinising the tech industry.
Virtual reality, which chief executive Tim Cook has already declared an area of great potential, and the much-rumoured Apple car could both prove extremely lucrative for the tech giant, he believes.
He also thinks Apple could set its sights on the potentially lucrative Indian market.
"Although it is a tough challenge for Apple to sell full price iPhones in India, the sheer scale of the population and potential for smartphone adoption cannot be ignored," he said.
Failing that, Apple could take on the likes of Amazon and Sky as a major content provider, Mr Wood argued.
"Apple has a huge cash pile that would allow it to easily purchase the rights to major sporting events or other hot content areas," he said.
"Given its ability to distribute content to the huge installed base of affluent Apple device owners, this could be a new direction for the company."
The environmentalist
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Chief Policy Adviser Martin Baxter from the Institute of Environmental Management & Assessment also believes cars are a smart move for the firm, but not necessarily the autonomous type.
"With air quality concerns in the news, clearly electric vehicles have the potential to reduce harmful emissions - if we have renewable energy to generate the electricity," he said.
"Apple has a big role to play in both the vehicle, and energy harvesting, making the process more efficient. It would be a completely new market for them and would also address those challenges."
Liam, Apple's iPhone recycling robot, is all very well, but Mr Baxter wants to see the firm go further.
Apple
"They could do more on repairability," he said.
"It's great that they can recover material but what we want is more product durability."
That might not help boost sales however.
The technology journalist
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Cam Bunton, editor of 9to5Mac, believes Apple needs to come out with its next landscape-changing product.
"As a tech enthusiast Apple is pretty boring," says Mr Bunton.
"They release stuff once or twice a year, it's usually similar to what they've done already. It's a good strategy and makes them lots of money though," he says.
"That said, I think the iPhone SE is an important device for those who maybe want all the performance and spec of an iPhone but haven't been able to afford one."
Mr Bunton also called for more openness from the notoriously secretive company - but conceded that perhaps that's part of its appeal.
"I would like them to share more - stop pretending developing tech is a massive secret that nobody else is doing.
"But I guess that's what has made them successful - the secrecy builds up excitement so when they release something it sounds brand new," he said.
The accountant
Graham Seddon, partner and technology sector specialist at accountancy firm Menzies, also thinks the iPhone is entering its twilight years.
"Even the greatest product, from the greatest brand, has a lifecycle that will end," he said.
"The macroeconomic factors of a strong US dollar and slowing growth in China have had an impact, alongside the ongoing competition in the smartphone market as other manufacturers have played catch-up.
"For the moment, Apple's Tim Cook seems to be adamant that the dip in performance is merely a 'pause' in growth and he seems to be in denial that global demand for iPhones could at last be waning.
"We will have to wait and see if products like the Apple Watch, iPad or even the 'Apple Car' can help to drive up revenues once again."
The web scientist
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"Take the base that you've got and keep innovating," says Professor Les Carr from the University of Southampton.
"I don't join in the clamour for Apple having to deliver another landmark product such as iPhone.
"What Apple do is bring out technology that provides a certain level of innovation then incrementally improve it. I think they aren't one for releasing a million products onto the market and seeing which one flies."
Prof Carr thinks there is yet more potential in the Apple Watch, and also believes its foray into health and wellbeing with its Apple Health tracking service will prove successful.
"Personal health is going to be a huge market and Apple has the product to leverage that."
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