China was the only region where Apple’s revenue declined last quarter

Independent analysts have already noted that this year, for the first time in several years, Apple failed to get into the top five largest smartphone manufacturers in the Chinese market. The quarterly report, which reported a 7% year-on-year decline in regional revenue, also sent alarming signals about the decline in demand for the brand’s products in China. All other macro-regions of Apple’s presence increased their revenue.

Image source: Apple

In Apple’s calendar, the third fiscal quarter of the current year ended on June 29, so it is already measuring nine months of the fiscal year in its reporting. If in the previous quarter the company’s revenue in China (including Taiwan and Hong Kong) decreased year-on-year by 7% to $14.73 billion, then over the nine months of the fiscal year the decline reached 10%. Over a three-month period, Apple explains this decrease in revenue precisely by the deterioration in iPhone sales statistics, separately emphasizing that in the region its revenue is more dependent on the sale of smartphones than in other geographic markets. If we consider the nine months of the current fiscal year, then the iPad, which only managed to be updated in the last quarter, is added to the iPhone as a factor spoiling the dynamics of Apple’s revenue in China.

Apple management at the reporting conference said that if it were not for the weakness of the yuan against the US dollar in the reporting period, the decline in revenue in this geographic area in the second quarter would not have exceeded 3%. In any case, analysts surveyed by Bloomberg on average expected Apple to receive revenue of $15.26 billion in the second quarter in China, and its actual value did not exceed $14.73 billion. China, together with Taiwan and Hong Kong, continues to be the third largest largest market for Apple products, and therefore very important for the company.

CEO Tim Cook said on the quarterly earnings call: “We continue to remain confident in our long-term opportunities in China. I don’t know what’s in every chapter of the book, but we’re very confident in the long term.” The head of Apple also added that last quarter in China a seasonal record was set for the number of iPhones sold, purchased by owners of previous models. “This is a very strong signal,” Cook emphasized. He also added that the company is working with regulators in China to eventually offer local customers a version of Apple Intelligence technology adapted to meet the requirements of local legislation.