Apple on Thursday disclosed its iPhone sales dipped slightly during the holiday-season quarter, signaling a sluggish start to the trendsetting company’s effort to catch up to the rest of Big Tech in the race to bring artificial intelligence to the masses.

The tech giant’s sales of apps and services helped profit grow 7 percent from a year ago, even as the company contended with slumping sales in China.

Apple (AAPL) reported fiscal first-quarter earnings that topped estimates as its services revenue rose, though iPhone sales fell short. The iPhone maker’s revenue rose 4% year-over-year to a record $124.