In the end, China caught up with Apple.
Apple announced net profit and sales that exceeded market expectations in its earnings announcement on the 2nd (local time), but sales in China were revealed to have declined, and year-end sales forecasts were also presented lower than market expectations due to slowing demand in China, with stock prices trading after hours. fell by more than 3%.
On this day, Apple announced earnings per share for the last quarter at $1.46 in an earnings release immediately after the market closed. This exceeds market expectations of $1.39. Sales were $89.5 billion, which also exceeded market expectations of $89.2 billion.
Although performance exceeded market expectations, sales were revealed to have declined for four consecutive quarters. This is because sales in China have decreased. Sales in China decreased 2% compared to the same period last year. China is a representative growth market, and the decline in sales is very unusual.
First of all, iPhone sales in China are not what they used to be. China is Apple’s largest market, selling more iPhones than the mainland United States.
iPhone sales are decreasing in China. This is because rival Huawei unveiled its latest phone, the ‘Mate 60 Pro’, and is making rapid progress thanks to China’s patriotic consumption.
Apple daily stock price trend – captured by Yahoo FinanceIn addition, the Chinese government’s ban on public officials using iPhones is having a significant negative impact on Apple’s sales in China. Although the Chinese government denies this, the Wall Street Journal (WSJ) in the United States reported that the Chinese government is banning the use of iPhones not only by public officials but also by public enterprise employees.
CEO Tim Cook explained in a conference call after the earnings announcement that day, “Sales in China have decreased due to the volatility of the yuan,” but experts agree that the decline in sales in China is clear.
In addition, this quarter’s earnings outlook was disappointing.
Chief Financial Officer Luca Maestri predicted in a conference call that sales this quarter would be similar to the previous year. He added that he made this conservative decision because sales in China were slowing.
Wall Street expected Apple’s fourth quarter sales to hit $122.98 billion, up 4.97% from the previous year.
As negative news from China continued, Apple fell 3.56% to $171.25 in after-hours trading on the New York Stock Exchange. Previously, the regular session closed up 2.07%.
Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.