Apple Highlights Services as iPhone, China Slump

Apple is still overwhelmingly in the business of selling iPhones, but clearly its growth is going to come from services and the Apple Watch. And the tech giant is doubling down, particularly in services. Apple’s product sales fell 9.2 percent in the first quarter, with iPhone sales dropping 17.3 percent to $31.1 billion. The Apple Watch helped pick up some of that slack, but not enough. Tim Cook, chief executive officer, told analysts the company’s wearables business grew nearly 50 percent in the quarter and is now the size of a Fortune 200 company after just four years — suggesting it drives revenues of over $14 billion. (Aramark, the 200th company on the Fortune 500, has revenues of $14.6 billion). Although the Apple Watch did not meet the lofty fashion expectations some had for it, it has gained serious share in the market place and has carved out a health-oriented niche that plays into its digital capabilities. Apple’s services business is much smaller than the gadget side, but is seen as the future. Services sales increased 16.2 percent to $11.5 billion. In March, Apple made a flashy presentation highlighting expansions in news, games, payments and original content, trotting out Steven Spielberg, Reese Witherspoon, Jennifer Aniston, Steve Carell,

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