This time, new information pouring in from Asia suggests that 18 million units of the iPhone 12 have been sold in Greater China. At these levels, Apple controlled over 20% of the smartphone market in the fourth calendar quarter.
This is quite a feat for Apple in a geographic market heavily dominated by domestic vendors, including Huawei and Xiaomi.
The numbers above are crucial for the Cupertino company, since they suggest strength in two segments that have struggled to produce revenue growth recently: iPhone and Greater China.
The charts below show how these two important slices of Apple’s business – the former accounting for 50% of total revenues and the latter, for 15% – were the worst-performing in fiscal 2020.
Finally, strength from the East
Greater China is a particularly interesting topic of conversation.
The geographic region was once considered Apple’s growth engine. In fiscal 2015, revenues had increased by an impressive 84% year-over-year to account for about one-fourth of the company’s total revenues.
But since then, the market has cooled off substantially.
The back-to-back drops in China sales seemed to best explain investors’ bearishness towards Apple stock. Shares declined in full-year 2015 for the first time since the 2008 Great Recession, and for the second time since the dot-com bubble burst.
As recently as August 2020, I argued that China would remain a problem until 2021. Probably breaking the spell would be the launch of Apple’s 5G-equipped smartphone, which ended up happening in October of last year. Worth noting, more than 50% of smartphone shipments in China, as of late, have been of 5G-ready devices.
Supported by encouraging news on the iPhone front, the holiday quarter may very well mark a long-awaited turnaround for Apple in the Far East.
Twitter weighs in
I am running a poll on Twitter, in which I ask: what could be expected of Greater China in the holiday quarter? Feel free to share your opinion below.
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