Business

China has become the Apple of Tim Cook’s eye as sales soar

A new iPhone 12 lineup and 5G pushed up revenue by 57% in the world’s second-largest economy

Peel away the numbers and you will find China remains at the core of Apple’s strategy.

A new iPhone 12 lineup helped push up sales by 57% in the world’s second-largest economy during the final three months of 2020.

The decision to ship an array of high-tech products slightly later in the year also tapped into pent-up demand despite the Covid-19 crisis.

Still, the fact that the US group generated sales of more than US$100 billion in just one quarter is staggering.

“We had two of the top three selling smartphones in urban China [with people] upgrading [models, setting] an all-time record in China,” Apple CEO Tim Cook told a conference call as reported by the Reuters news agency.

The facts:

  • New 5G iPhones were the driving factor in China. 
  • Global revenue or sales hit $111.44 billion for the holiday-period quarter, an increase of 21% compared to 2019.
  • Sales of iPhones were $65.60 billion, surpassing the record set three years ago. 
  • Mac sales came in at $8.68 billion with iPad revenue of $8.44 billion.
  • The group’s services business, including its new Apple One bundle of television, music and cloud storage services, posted revenue of $15.76 billion 
  • Wearables and accessories, including the Apple Watch and AirPods product lines, generated sales of $12.97 billion.
  • Apple is now valued at $2.5 trillion.
  • The number of Apple products being used topped a staggering 1.65 billion.

What was said: “The products are doing very well all around the world. As we look ahead into the March quarter, we’re very optimistic,” Luca Maestri, Apple’s chief financial officer, told investors.

Reaction to the news: “This strength in iPhone sales provides evidence for Apple bulls that another iPhone supercycle may be in the cards,” Dan Morgan, a senior portfolio manager at Synovus Trust Company, told the Bloomberg news agency.

China Factor comment: The coronavirus pandemic has been a game-changer for Big Tech. People across the globe are spending more time at home, using the online world as a lifeline. Apple and other tech titans, such as Facebook and Google, have cashed in on this trend. But that could start to change when the planet finally emerges from the shadow of Covid-19.

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