Apple snaps out of iPhone slump, but for what's next?

Features Associated Press

  • FILE - In this Sept. 7, 2016, file photo, Phil Schiller, Apple's senior vice president of worldwide marketing, talks about the pricing on the new iPhone 7 during an event to announce new products, in San Francisco. Eliminating the headphone jack doesn't seem to have hurt sales of the iPhone 7, which appears poised to reverse Apple's recent sales slide. Though not by much, which leaves a question that's shadowed the company for nearly a year: What's its next act? (AP Photo/Marcio Jose Sanchez, File)

    FILE - In this Sept. 7, 2016, file photo, Phil Schiller, Apple's senior vice president of worldwide marketing, talks about the pricing on the new iPhone 7 during an event to announce new products, in San Francisco. Eliminating the headphone jack ... doesn't seem to have hurt sales of the iPhone 7, which appears poised to reverse Apple's recent sales slide. Though not by much, which leaves a question that's shadowed the company for nearly a year: What's its next act? (AP Photo/Marcio Jose Sanchez, File) (The Associated Press)

  • FILE - In this Friday, May 13, 2016, file photo, a man uses his mobile phone near an Apple store in Beijing, China. Apple Inc. reports financial results Tuesday, Jan. 31, 2017. (AP Photo/Ng Han Guan, File)

    FILE - In this Friday, May 13, 2016, file photo, a man uses his mobile phone near an Apple store in Beijing, China. Apple Inc. reports financial results Tuesday, Jan. 31, 2017. (AP Photo/Ng Han Guan, File) (The Associated Press)

Apple has snapped out of the first sales slump in the iPhone's decade-long history, but the upturn doesn't mean that the company has broken out of its innovation funk.

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If anything, the numbers Apple released Tuesday served as the latest reminder of the company's growing dependence on the iPhone while failing so far to come up with another breakthrough product since co-founder Steve Jobs died in 2011.

Meanwhile, Apple's rivals have been rolling out new products in other promising fields such as augmented reality, virtual reality and artificial intelligence. Apple has been trailing in these areas.

To make matters worse, Apple's iPhone sales had fallen in three consecutive quarters before it rose 5 percent in the last three months of 2016 to 78.3 million units.