iPhone Sets Sales Record in Quarter

Apple appears to be holding its own against Samsung and other new rivals in the smartphone market. U.S. shipments of the iPhone rose 51 percent in the third quarter, setting a sales record and beating Wall Street's expectations, buoying Apple Inc.’s stock. But that wasn’t enough to actually cause profits—the company said Tuesday that profit fell 22 percent in the quarter, and gross margins were down 37 percent from more than 42 percent in the same quarter last year. The high U.S. sales of the iPhone are encouraging, but China’s economic decline weakened the company’s revenue. But all the iPhone sales don’t help with investors’ biggest concern about Apple: that the company’s days as innovators are over.