Apple results: Tim Cook has a China problem and maybe a bigger Asia opportunity

Apple's success story, as in the past few quarters, continues to be its services which has grown 24 per cent

Written by Nandagopal Rajan | Published:October 26, 2016 7:20 am
Apple, apple inc, apple news, apple results Apple results: Incidentally, rest of Asia Pacific — excluding Greater China and Japan — recorded a 13 per cent sequential rise

Apple’s tryst with China seems to be on a slide. What was supposed to be the next big growth market for Apple has shown a 30 per cent drop in revenue compared to last year as per the financial results for Q4 2016 that ended September 24, 2016. However, it seems to have been able to arrest the fall in comparison to the last quarter as the sequential diference is just -1 per cent.

Incidentally, rest of Asia Pacific — excluding Greater China and Japan — recorded a 13 per cent sequential rise and it is likely that India has contributed significantly to these numbers. Older Apple devices are becoming more popular in India due to its affordability.

The other interesting story is the iPad which seems to be becoming more and more niche. The number of units sold sell by -7 per cent sequentially and -6 per cent in comparison to last year. Apple might be able to revive this segment which new products later this year. Thankfully for Apple, it seems to be the only company that is still able to make an impact in the tablet segment.

Apple revenue

Apple’s success story, as in the past few quarters, continues to be its services which have grown 24 per cent in comparison to last year. This is a rise of 6 per cent against the last quarter.

Apple CEO Tim Cook said the company is thrilled with the “the incredible momentum of our Services business, where revenue grew 24 percent to set another all-time record.”

Overall, Apple posted a quarterly revenue of $46.9 billion and quarterly net income of $9 billion. For the same quarter in 2015, these numbers were $51.5 billion and $11.1 billion, repectively. International sales accounted for 62 percent of the quarter’s revenue.

However, powered by the initial response to its new iPhone 7 series and the holiday season, Apple is providing strong guidance for Q1 2017, projecting “revenue between $76 billion and $78 billion”.