Apple reported a drop in sales for the fourth consecutive quarter amid a slowdown in China and competition from its rival, Huawei Technologies. According to the latest BNN breaking news, it is the fourth straight quarter for Apple to report a drop in its total revenues. It is in line with the estimates of analysts.
Shares of Apple declined by 3%
The sales of Apple are declined by 1% year over year to $89 billion. According to a communiqué from an Apple executive, the company expects to post a similar drop in December this year, similar to those posted for the same period last year. Following the release of earnings, the shares of Apple declined by 3% in the aftermarket hours.
Investors in Apple are worried about challenges in China and have offloaded its shares, causing them to decline by over 10% after recording an all-time high in the summer. Apple became the first corporation in the world to flock close to a market value of more than $3 trillion in late June.
The business for iPhones remains strong
According to a release from Apple, the business for iPhones has advanced to $43.8 billion, an increase of 2.8%, which matches the estimates of analysts. In September 2023, Apple unveiled four innovative phones in the iPhone 15 series. The models introduced in September boast better cameras and titanium cases.
Also Read: Apple Releases iOS 17.1.1: A Proactive Approach to User Experience
The economic slowdown plays a spoilsport
China is the third-biggest market for Apple. Its revenues dropped to $43.8 billion, a drop of 2.5%, in China, missing the estimates of analysts. It is against the backdrop of increased government scrutiny, stronger competition from rivals like Huawei Technologies, and a broader economic slowdown in China. China has banned the use of foreign-branded phones for work. In addition, central government employees in China are not allowed to use iPhones.
In an interview, the CFO of Apple, Luca Maestri, said the market in China is always the most competitive in the world and will remain so in the future. According to Maestri, iPhones command significant demand in China. He further stated that the market share of iPhones had significantly improved in mainland China.
In September 2023, Huawei made a comeback in China during the quarter by unveiling an innovative premium phone, the Mate 60 Pro. The new device expects to achieve 5G speeds using domestically developed technology. The company was forced out of the market for several years because of the impact of Western sanctions.
Huawei expects to make strong gains
In the latest BNN world news, Zacks Investment Management’s portfolio manager (for clients), Brian Mulberry, said Huawei will make significant gains in its domestic market. The services unit of Huawei has performed well, by an impressive 16%.
Huawei posts year-on-year sales growth of 37%
Huawei reported sales growth of 37% in China compared to a year earlier for the three months ending September. On the other hand, the sales of iPhones in China shrank by 10% during the same period. In a communiqué shared by Counterpoint Research, the sales of smartphones in China dropped by 3% during the same period.