Apple’s quarterly revenue fell 13 percent to $50.6 billion and iPhone sales dropped 16 percent, ending 13 years of uninterrupted year-over-year sales growth and exposing the company’s dependence on a smartphone market entering maturity.

Apple sold 51.2 million iPhones in the three months ended March 26, down from 61.2 million a year earlier. Profit fell to $10.5 billion from $13.6 billion, while revenue in Greater China declined 26 percent.

The company’s earnings announcement attributed part of the decline to a strong dollar and difficult comparisons with the iPhone 6 launch. Yet the scale of the change points to a deeper issue: many consumers already own capable smartphones and are keeping them longer.

The iPhone comparison becomes unforgiving

The iPhone 6 introduced larger screens and triggered an exceptional upgrade cycle. Its successor, the 6s, improved performance and added pressure-sensitive controls but preserved the same basic design. Apple therefore faced both market saturation and an unusually strong prior-year benchmark.

Wired reported that iPhone unit sales fell for the first time since the product launched in 2007. Because the device supplies nearly two-thirds of Apple’s revenue, a unit decline quickly becomes a companywide decline.

Carrier practices are also changing. U.S. operators are replacing subsidized two-year contracts with installment plans that reveal the full cost of a phone. The shift may encourage customers to delay upgrades rather than treat a new device as a routine contract benefit.

Apple’s quarterly filing shows that the slowdown reached other hardware: iPad unit sales continued to fall and Mac revenue declined. Services, including the App Store, Apple Music and iCloud, grew strongly but remain much smaller than the iPhone business.

China changes from engine to risk

Greater China had been Apple’s fastest-growing major region. The 26 percent revenue decline reverses that role amid economic uncertainty, currency pressure and competition from Huawei, Xiaomi, Oppo and other local manufacturers.

Chief Executive Tim Cook said Hong Kong accounted for a disproportionate part of the decline and argued that mainland China’s long-term prospects remain strong. He pointed to growth in the installed base and retail expansion.

A Time analysis connected the revenue decline to weaker iPhone sales, China and a cautious forecast for the next quarter. Apple expects revenue of $41 billion to $43 billion, below Wall Street expectations and well below the comparable period.

The new iPhone SE may help by offering current components in a smaller, less expensive device. But it shipped too late to affect the reported quarter and may generate lower revenue per unit than flagship models.

Services offer a second growth mechanism

Apple now has more than one billion active devices, creating an audience for applications, music, storage, payments and other recurring services. Services revenue rose 20 percent, a rate that makes the segment increasingly important.

The mechanism differs from hardware. Apple earns fees when customers purchase applications and subscriptions, producing revenue long after a device sale. A larger installed base can therefore support growth even when annual iPhone shipments flatten.

The company’s results also announced an expansion of its capital-return program. Apple will return additional cash through dividends and share repurchases, reflecting enormous cash generation despite the decline.

Another contemporary report noted that Apple still sold more than 51 million phones and generated more than $10 billion in quarterly profit. The problem is not immediate weakness but the difficulty of sustaining growth from an already vast base.

A mature smartphone market tests innovation

Global smartphone shipment growth is slowing as penetration rises in wealthier countries. Midpriced Android phones increasingly provide high-quality screens, cameras and processors, reducing the performance gap that once encouraged consumers to pay flagship prices.

An IDC market estimate found worldwide smartphone shipments nearly flat in the first quarter. Apple’s decline is therefore part of an industry transition, though its premium positioning and concentrated product portfolio make the effect especially visible.

Cook emphasized future products without identifying them. Apple is investing in health, automotive technology, artificial intelligence and new services, but none yet approaches the iPhone’s scale.

The company must manage two tasks at once: persuade current users to upgrade and create businesses that reduce reliance on that cycle. The Apple Watch, television products and services broaden the portfolio, but hardware categories take time to reach hundreds of millions of customers.

January’s record quarter had already warned that the next period could bring a revenue decline. Tuesday confirms that the iPhone supercycle has ended. Apple remains extraordinarily profitable, but investors can no longer assume that each new model will automatically sell more units than the one before it.