Apple beats expectations, but sharp contraction in China

Cupertino looks to India for expansion as prices come down

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Image: Dotdash Meredith

Apple earned more from iPhones last year than expected, even though fewer were sold according to second quarter results released today. On the other hand, more Macs and iPads were shipped. The Apple Watch did less well.

Sales of iPhones fell 0.9% to $39.3 billion, but analysts had expected a larger drop, so the numbers were not as bad as expected.

Quarterly revenue was $85.7 billion, up 4.9% from a year earlier. Net profit came to more than $21.4 billion last quarter, from about $19.9 billion a year earlier.

“Today Apple is reporting a new June quarter revenue record of $85.8 billion, up 5% from a year ago,” said Tim Cook, Apple’s CEO. “During the quarter, we were excited to announce incredible updates to our software platforms at our Worldwide Developers Conference, including Apple Intelligence, a breakthrough personal intelligence system that puts powerful, private generative AI models at the core of iPhone, iPad, and Mac. We very much look forward to sharing these tools with our users, and we continue to invest significantly in the innovations that will enrich our customers’ lives, while leading with the values that drive our work.”

However, Apple is not doing well in China. In China, there was a contraction of about 6.5%, on total sales of more than $14.7 billion.

According to market research firm Canalys, Apple disappeared from the top five smartphone vendors in China for the first time in years. In the second quarter of 2024, the iPhone company ranked sixth – behind Vivo, Huawei, Oppo, Honor and Xiaomi.

There are, however, opportunities in India. The Indian government cut the import fee for smartphones by 5% to 15%. Apple responded immediately, cutting prices by 3-4%, depending on the model. Apple has never made pro-iPhones cheaper in India before. Depending on the model, more than €50.

The group also continues to expand production in India. Apple is about to produce iPhones Pro in India. At a factory in Tamil Nadu that Foxconn operates, the iPhone 16 Pro could be made as early as this year or next.

Apple, meanwhile, is moving forward with its first foldable iPhone. The tech giant reportedly plans to launch the device in 2026. It would be a clamshell model, similar to Samsung’s Galaxy Z Flip.

Apple on Monday released a first beta of iOS 18.1 for developers. In it, the first features of Apple Intelligence can be tested.

Read More: Apple Results