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Apple revenue in China down but Cook confident it will grow

(ATF) On October 30, Beijing time, Apple released its fourth fiscal quarter report as of Sept 26, 2020. The report showed that Apple’s fourth-quarter net revenue was $64.7 billion, a slight increase from $64 billion in the same period last year, and its diluted earnings per share were $0.73.

By region, Apple’s fourth-quarter revenue in the United States was $30.7 billion, Europe was $16.9 billion, Greater China was $7.9 billion, Japan was $5 billion, and the Asia-Pacific region except China and Japan was $4.1 billion.

Among them, only the revenue of Greater China declined, taking a 28.6% fall from $11.1 billion in the same period last year, and a decrease of $9.3 billion from the previous quarter. The United States increased by 4.7% year-on-year, the European region increased by 13.1%, Japan increased by 0.8%, and the Asia-Pacific region outside China and Japan increased by 13%.

In the post-earnings meeting, China’s Interface News reported Apple CEO Tim Cook explained that in the last two weeks of September this year, the company did not release its new iPhone in China, which led to a decline in revenue in Greater China. The iPhone 12 was originally scheduled to be released in September, was repeatedly postponed, and the global release was officially launched in late October.

But Cook also said that usually from the time when Apple launches the new iPhone, sales in the Chinese market “grow from the perspective of customer demand.” Based on the strong basic business in the Greater China region in the previous quarter, he believes that starting from this quarter, “take a quick look at the comparison of the figures from this quarter, and the situation may be quite different.”

“Considering the situation we saw when we launched the new iPhone in the early days, we are confident of achieving growth in the first quarter,” he said.

Divided by sector, iPhone revenue for the quarter was $26.4 billion, a year-on-year decrease of 20.7%; Mac revenue was $9 billion, a year-on-year increase of 29.1%; iPad revenue was $6.8 billion, a year-on-year increase of 46%; wearable devices were $7.9 billion, a year-on-year increase of 20.8 %; service revenue was $14.5 billion, a year-on-year increase of 16.3%.

Among them, in addition to the decline in iPhone revenue, the revenue of Mac and services have seen a record high. According to Interface’s analysis, this is still due to the rising demand for home office services during the prevention and control period of the coronavirus epidemic.

In the financial report, Tim Cook said, “Although the impact of Covid-19 continues, Apple is still in its best earning product launch period in history, and is led by our first iPhone product lineup with 5G capabilities. The early response to the new product was very positive.”

Apple CFO Luca Maestri believes that despite the extremely turbulent and challenging macro environment, the company has set new records in terms of departmental revenue, earnings per share and cash flow. “During the quarter, we returned nearly $22 billion to shareholders.”


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Chris Gill

With over 30 years reporting on China, Gill offers a daily digest of what is happening in the PRC.


AF China Bond