Apple CFO Kevan Parekh said softness in mobile gaming and App Store business model changes in some countries impacted App Store performance during the earnings call. Services revenue reached $30.7 billion, up 12% from $27.4 billion year-ago, but missed expectations.

Parekh cited headwinds in mobile gaming and App Store fee updates in Japan and Brazil, plus a U.S. court ruling on link-out transactions and lower fees from alternative marketplaces in the EU. Despite changes, the App Store set a June quarter revenue record. Double-digit growth occurred in cloud, video, payment services, and advertising, with record Apple Pay users.

Apple now has 1.5 billion paid subscriptions, with transacting and paid accounts at an all-time high. Parekh noted a foreign exchange hit of approximately 2.5 percentage point headwind and a tough compare versus last year's F1 theatrical release. September quarter services growth is expected similar to June quarter excluding the FX headwind.