Category Archives: china

Apple grew 157% in China to over $16B in revenue last quarter

Apple-China-Q1-2015

Ahead of Apple’s fiscal Q1 2015 earnings report today, there were signs that Apple had enjoyed significant growth in China and a record number of smartphone sales in the region during the holidays. Today, we get some more insight into that growth, as Apple reported a 157% increase from the previous quarter: revenue of $16.144 billion in Greater China compared to $6.292 billion in Q3.

That’s up 70% year over year from the $9.496 billion the company pulled in from the region in the holiday quarter last year.

Compare Apple’s 157% growth in China with an increase of around 55% for the Americas during the same period. The Americas remained Apple’s largest market at $30.566 billion for the quarter. China’s $16.144 billion was a very close third behind Europe at $17.2 billion during the quarter.

During the Q&A of the earnings call, Cook noted China will soon be at 20 retail stores with plans to double that number to 40 total by mid-2106. Online revenues in China were more than sum of the previous 5 years, according to Cook.

Leading up to today’s earnings report, analysts reported Apple became the top smartphone vendor in China for the first time last quarter, and sold more iPhones in the country than it did in the US.

We expect Tim Cook and other Apple execs will make a point of noting growth in China during the company’s earnings call with investors later today. Stay tuned to our live blog here.


Filed under: AAPL Company Tagged: AAPL, Apple, china, earnings, growth, iPhone, Q1 2015, sales, year-over-year

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Live blog: Apple’s Q1 2015 earnings call

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As it revealed earlier this month, Apple will have its quarterly conference call today at 2 PM Pacific/5 PM Eastern to discuss earnings from its fiscal year 2015 first quarter results. These results include sales 74.4 million iPhones, 21.4 million iPads, and 5.5 million Macs. Earlier today the company reported that it earned $74.6 billion in revenue during FY 2015 Q1.

While Apple’s previous quarter included the opening weekend of iPhone 6 and iPhone 6 Plus sales, today’s numbers include the bulk of the sales in the United States and the initial sales of the new models in key markets including China. Today’s reported numbers do include the first sales numbers for the iPad since Apple began shipping the iPad Air 2 and iPad mini 3, and the first Mac numbers since the Retina 5K iMac went on sale. Apple Pay will also be an area of interest for listeners as the mobile payment service only launched the day of the last quarterly conference call.

Investors and analysts will have an opportunity to ask Tim Cook and company questions during the earnings call, and we’ll be listening closely to bring you coverage.

Earnings report is live!

– Welcome music is also live for any listeners. Follow along at home or refresh for highlights from the call here. Should begin at the top of the hour.

– To recap, $74.6 billion in revenue and 74.4 million iPhones.

– Apple up in after-hours trading:

AAPL

– 7 minute warning!

– Here we go. Apple CEO Tim Cook will speak first, followed by Apple CFO Luca Maestri, then questions.

– Cook speaking now about interest in Apple products reaching an all-time high, notes record breaking iPhone sales for the quarter

– More than 34 thousand iPhones sold per hour, Cook says

1 billionth iOS device sold, a space gray 64GB iPhone 6 Plus says Cook, kept at Apple now

– Talking Swift language now, dev tools downloaded 11 million times

HealthKit in 600 apps, Cook says

– Over 30 automotive brands delivering CarPlay in 2015, expects HomeKit products this year

– About 750 banks and credit unions signed to bring Apple Pay, $2 out of $3 spent using contactless payments made with Apple Pay

Apple Watch shipping in April, Cook says based on current development rate

– Talking IBM partnership now, recapping apps released with IBM last year, says another 12 apps will be released this quarter in three new industries bring app total to 22

– Talking ConnectED and Product(RED) projects for education and World AIDS Day, says Apple’s donation for RED set a new record

– Luca Maestri talking now, recapping earnings numbers

– Says supply and demand balance reached this month for iPhone

– 447 Apple Store locations, 182 outside of United States, planning to have 40 Apple Store locations in China by mid 2016

– Company has $178 billion in cash

– Question time!

– First question about currency: Luca says Q1 growth revenue would have been 4% higher without currency fluctuation

– Now asked about adjusting product pricing, Luca says prices usually adjust during new cycles with exception being massive shift in Russia leading to mid-cycle adjustments

– Question about iPhone 6 and iPhone 6 Plus mix, Cook won’t break out numbers but says iPhone 6 most popular iPhone last quarter, says some geographic areas prefer iPhone 6 Plus but not consistent around the world

– Cook asked about iPhone sustainability given previous quarter, Cook says Apple bullish on iPhone going forward

– Apple Watch question about timing and expectations, Cook says his expectations very high, he can’t live without it, Apple making great progress on development of it, many developers writing apps for it

– Cook says Early 2015 means first four months, Mid means next four months, Late means last four months…

– Online revenues in China more than sum of the previous 5 years

– Cook asked about iPad forecast, Cook says short run won’t see miraculous change but optimistic about future based on first time buyer rate

– Gene Munster asking about update on Apple TV and the living room, Cook says over 25 million of the current product sold, up from 20 million in April 2014,  now talking Apple Pay, Cook says shocked how many merchants were able to implement Apple Pay during the holiday season, says this is the year of Apple Pay

– On iPhone growth, Cook says a small fraction of install base has upgraded (in the mid teens) so far, Android and non-smartphone owners big opportunity

– Cook says working with IBM helps facilitate creating specific apps for industries, will help drive iPad in the enterprise

– That’s a wrap! Replay will be available on iTunes shortly.


Filed under: AAPL Company Tagged: Apple, Apple earnings, Apple pay, china, earnings call, iPhone 6, iphone 6 plus, luca maestri, Q1 2015, Tim Cook

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Apple became top smartphone vendor in China for the first time in Q4

Westlake Apple Store, Hangzhou, China

Following reports that Apple is now selling more iPhones in China than in the US, today Canalys is out with research showing Apple for the first time lead smartphone sales in China by units shipped during the last quarter of 2014.

The incredible popularity of the iPhone 6 and 6 Plus in China in Q4 2014 has led Apple to take first place in the Chinese smart phone market for the first time by units shipped. This is an amazing result, given that the average selling price of Apple’s handsets is nearly double those of its nearest competitors… While Chinese smart phone vendors are quickly gaining ground internationally, Apple has turned the tables on them in their home market. The company is finally riding the large screen and LTE trends in China, which have been vital to its success, along with a well-timed launch and a clampdown on grey exports of its products out of Hong Kong.

Apple was followed by Xiaomi, Samsung and Huawei rounding out the top four spots, according to Canalys. The news comes just as analysts predict China accounted for as much as 36 percent of Apple’s iPhone shipments last quarter. The U.S. made up 24 percent. That’s compared with around 22 percent for China in the year ago quarter, which is all to say Apple’s has experienced significant growth in China since the launch of the new iPhone 6 and iPhone 6 Plus. 

Earlier this week we reported that Apple’s new retail chief Angela Ahrendts is recruiting U.S. employees for the company’s retail stores in China as Apple plans to open more than 15 new locations in the region.

Apple will report its fiscal Q1 2015 earnings results for the three months ending in December of last year later today and we expect Tim Cook and other execs will take time to talk growth in China.


Filed under: AAPL Company, iOS Devices Tagged: Canalys, china, iPhone 6, iphone 6 plus

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Apple supplier Foxconn to cut workforce despite likely record iPhone sales [Update: Foxconn denies]

foxconn

Update: Foxconn has denied the Reuters report, stating that the claim is “completely inaccurate and totally without foundation.” The company told us that increased automation will result in reduced recruitment, but that there are no plans to reduce its workforce “now or anytime in the future.”

Foxconn, the lead assembler for iPhones, is planning to cut its workforce despite widespread expectations that Apple will today announce record sales of its smartphones, reports Reuters. It’s likely that the proposed reduction in staffing relates to Foxconn’s work for other manufacturers, who account for around 60% of the company’s revenues. Also, Apple sells a lot more stuff during the run up to the holidays so seasonal workers might be let go after demand is met.

Special assistant to the chairman and group spokesman Louis Woo did not specify a timeframe or target for the reduction, but noted that labor costs had more than doubled since 2010 […]

“We’ve basically stabilized (our workforce) in the last three years,” Woo said. When asked if the company plans to reduce overall headcount, he responded “yes”.

Foxconn experienced double-digit revenue growth from 2003 to 2012, but has seen that growth slip in the past couple of months as the PC market contracts and smartphone growth rates slow. The company has been trying to work its way up the Apple food-chain from assembly and low-cost components into more expensive parts like displays.


Filed under: Tech Industry Tagged: Apple Inc, china, Foxconn, iPhone, iPhone 6, Terry Gou

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Anticipated iPhone numbers would see Apple threatening Samsung’s smartphone lead

samsung

If Apple does indeed report iPhone sales in line with analyst expectations of 66.5M units, the company could be closing in on the market share lead Samsung has held in the smartphone market since 2011, reports the WSJ.

Research company Canalys notes that Apple’s anticipated growth in iPhone sales coincides with a dramatic drop in sales of Samsung smartphones.

Samsung’s share has been falling, hurt by lackluster sales of its flagship models and the rise of homegrown brands in fast-growing emerging markets. In the third quarter, Samsung shipped about 78 million smartphones, about 25% share of the global market, down from 34% a year earlier, Canalys said.

While that still leaves Samsung well ahead for now, it’s a trendline which could see Apple regain the lead it once held … 

Apple is expected to announce its most profitable quarter ever later today, thanks to record iPhone sales generated by demand for the larger-screened iPhone 6/Plus.

While the first quarter after an iPhone launch usually marks a peak in sales for the year, Samsung is coming under increasing competition from Chinese manufacturers like Xiaomi, while Apple is seeing its Chinese sales grow. Analysts expect Apple to have sold more iPhones in China than in the US during Q1.

“It’s going to be closer than it’s ever been since Samsung took the lead,” said Chris Jones, principal analyst at Canalys.

While Apple and Samsung are rivals in the smartphone market, the two have a close relationship in the supply chain, with Samsung expected to make the majority of the A9 chips for the next-generation iPhone.


Filed under: AAPL Company, iOS Devices Tagged: AAPL, AAPL earnings, Apple Inc, china, iPhone, iPhone 6, iPhone 6 sales, Market share, Samsung, Smartphone, Xiaomi Tech

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Apple commissions another artistic mural for upcoming Chongqing, China retail store

Screen Shot 2015-01-26 at 5.47.28 PM

Last week Apple posted a video showing how the calligraphy mural painted at one of its upcoming Chinese retail outlets was created just days before that store opened to the public.

Today the company has posted a new video of a second mural, this time at its new Chongqing location. The store features a unique cylindrical entrance, and Apple commissioned two artists—a China-based painter and US-based photographer—to collaborate on the artwork.

From the Apple Retail site:

To celebrate the opening of the new Apple Store retail outlets, we have invited international artists from Chongqing to Yangyang Pan, as well as award-winning international photographer Navid Baraty co-authoring a piece of art. This works not only convey the worth of Chongqing is a wonderful gathering of the city, also means that the new Apple Store retail world will be a fusion of art, culture, creativity and technology in one.

The video can be viewed on Apple’s website, though for the moment the only version available is subtitled in Chinese, so English-speaking viewers won’t be able to understand some of what’s said. If Apple follows the same pattern as its last video, a version with English subtitles should appear on the company’s YouTube channel soon.

Apple’s expansion into China has been moving along at top speed in recent months. The nation’s version of Vogue was one of the first to go hands-on with the Apple Watch, and Apple is reportedly now selling more iPhones in China than the United States. Cupertino’s retail chief Angela Ahrendts was reported to be interested in recruiting US employees to move to China to help expand the company’s retail reach.

The Chongqing Apple Store will open on January 31st at 10 AM.


Filed under: AAPL Company Tagged: Apple Retail, Apple Store, china, Chongqing, Jiefangbei

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Angela Ahrendts recruiting U.S. employees for China as new stores & initiatives revealed

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Apple Senior Vice President of Retail Angela Ahrendts is continuing to go all in on growth in China. In video messages to employees in recent days and weeks, Ahrendts has been recruiting employees from United States-based Apple Retail stores to relocate to China to help build up Apple’s retail efforts in the region. In a note to employees late last week, sources say that Ahrendts reported that approximately 200 Apple retail workers from the U.S. have already offered to make the move. Ahrendts added that the offer to move to China “has no expiration date because as the business grows, our needs will only become greater, so as your personal and professional life changes, just always keep China at the top of your mind, because we’re going to need you…”

Ahrendts’s heavy emphasis on China began in her earliest days with Apple. In a May 2014 profile, we noted that China was a key element of Ahrendt’s three-part strategy in reinventing Apple retail in her image. Last summer, Ahrendts also reconstructed Apple’s retail executive team by adding a dedicated China-based leader to the top brass. Earlier this month, Ahrendts announced that five new Apple Retail Stores in China are opening earlier this year in advance of the Chinese New Year in February. As part of the announcement, Ahrendts said that “China is a huge and important market for every global company today.”

westlake_gallery_china-retailApple’s recent West Lake Store opening via Apple.com

Ahrendts also added that Apple is hiring for an additional 15 stores in the China market, but she did not comment on the locations. Sources now tell us that Apple has just begun hiring for new stores in the Chinese regions of South Nanjing and Dalian. The new Dalian store has been in the works for the past few years, with reports from 2012 indicating that the new store would be large in size and placed within a shopping mall. These two stores are not part of the five stores opening by the end of February, but are instead planned to open later in 2015. Apple opened up a massive new store in Hangzou over the weekend.

Apple has also begun hiring for a new store in South Sydney, Australia for an opening toward the middle of 2015, according to sources. This store adds to a growing list of over 20 stores located across Australia.

In addition to new stores, Ahrendts has been planning some new initiatives and features for Apple Retail Stores. Sources say that Apple has begun piloting a rollout of a new SMS-based system for alerting customers with wait time status updates for upcoming Genius Bar appointments. Apple is also working to completely revamp the Workshops program within Apple Stores. Workshops have traditionally been small classes for people with Macs, iPads, and iPhones to learn about the capabilities of their devices. Ahrendts is said to have told retail employees that these Workshops going forward will have different themes each month.

Finally, Apple is said to be planning to roll out new Apple Store employee attire. For years, Apple Store employees have worn work t-shirts themed to holidays or product launches. Going forward, employees will wear blue collared shirts with the Apple logo printed to the side. Ahrendts believes this is a more professional look, which may be appreciated by future customers of more fashion-oriented, higher-end Apple products.


Filed under: AAPL Company Tagged: Abercrombie & Fitch, Angela Ahrendts, Apple Inc, Apple Retail Store, Apple Store, china, Chinese New Year, Genius Bar, hangzhou, iPad, iPhone, Xiaomi Tech

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