Apple becomes top smartphone vendor in China for the first time

[Providence]

(RTTNews.com) -
Apple inc. said Tuesday after the markets closed that its first quarter profit rose 38% from last year, driven by all time record revenue from iPhone and Mac sales as well as record performance of its App Store.



The company's quarterly earnings per share also breezed past Wall Street expectations as did its quarterly sales. At the same time, the company gave a slightly downbeat revenue forecast for the current quarter.

"We'd like to thank our customers for an incredible quarter, which saw demand for Apple products soar to an all-time high," said Tim Cook, Apple's CEO. "Our revenue grew 30 percent over last year to $74.6 billion, and the execution by our teams to achieve these results was simply phenomenal."



Apple also declared a cash dividend of $0.47 per share, payable on February 12 to shareholders of record on February 9.

Luca Maestri, Apple's CFO, said, "We spent over $8 billion on our capital return program, bringing total returns to investors to almost $103 billion, over $57 billion of which occurred in just the last 12 months."

Apple shares are currently gaining 4.66% in after hours trading after closing the day's regular trading session at $109.14, down $3.96 or 3.50%. On November 25, 2014, Apple shares hit $119.75, and the company's market capitalization crossed $700 billion for the first time, making it the first U.S. company to reach the milestone. Apple is currently the world's most valuable company. Oil giant Exxon Mobil Corp.

the world's second biggest company, is far behind.


Apple sold a record 74.5 million iPhones in the first quarter, up 46% from 51.0 million in the same quarter last year. The company in September unveiled two new bigger smartphones, iPhone 6 and iPhone 6 Plus, which went on sale on September 19 with record breaking performance.

The company sold 5.5 million Macs in the quarter, up 14% from 4.8 million in the prior year quarter.

However, iPad sales for the first quarter fell 18% to 21.4 million units from 26.0 million units a year earlier. On October 16, Apple unveiled the next iteration of its tablets-- iPad Air 2 and iPad mini 3, with both sporting Touch ID fingerprint sensor found on the iPhone, as the company aims to tap the holiday spending season.

For the first quarter, the company's America revenue surged 23% year-over-year to $30.6 billion and Europe revenue increased 20% to $17.2 billion, but its Greater China revenue jumped 70% to $16.1 billion. Japan revenue rose 8%, while rest of Asia-Pacific revenue increased 33% from a year earlier.

In September, Apple also unveiled Apple Watch, featuring revolutionary new technologies and a pioneering user interface with a beautiful design that honors the rich tradition of precision watchmaking. The device is expected to be launched in early 2015.

Apple's new Apple Pay service became available in the US from October 20. Apple Pay supports credit and debit cards from the three major payment networks, American Express, MasterCard and Visa, issued by the top US banks.

For the first quarter ended December 27, 2014, the Cupertino, California-based computing and electronics company reported net income of $18.0 billion or $3.06 per share, compared to $13.1 billion or $2.07 per share for the year-ago quarter.

On average, 43 analysts polled by Thomson Reuters expected the company to earn $2.60 per share for the first quarter.

This marks the fourth straight quarter that the company has reported year-over-year profit increase following four quarters of profit declines.

Gross margin for the quarter improved to 39.9% from 37.9% in the prior year quarter, while operating margin for the quarter increased to 32.5% from 30.3% a year earlier.

Net sales for the first quarter jumped 30% to a record $74.60 million from $57.59 million in the same quarter last year. Forty analysts had a consensus revenue estimate of $67.69 billion for the first quarter. International sales accounted for 65% of the quarter's revenue.

Looking forward, Apple forecasts second quarter revenue of $52 billion to $55 billion. Gross margin for the second quarter is expected to be between 38.5% and 39.5%. Analysts currently expect the company to post revenue of $53.79 billion for the second quarter.

Apple Profit Climbs 38% On Record IPhone Sales - NASDAQ.com

 

[TaiShang]

BBC News - Huawei profits surge 34% on strong China demand

 

[Raphael]

As long as foreign firms don't run afoul of Chinese regulatory authorities by playing by the rules and working purely for their own commercial interests and not foreign political interests (like Google did), they have the potential to do very well in the Chinese market. The Chinese luxury goods market is an example of a market dominated by foreign firms. Chinese firms that hope to nab their own slice of their pie in this sector will not be able to rely on the state: they will have to push ahead by their own merits through marketing and quality refinement.

Anyway, Apple is an aspirational product for many Chinese and their Chinese marketing campaign has been very effective - they have some very savvy people analyzing for them exactly what Chinese consumers want. At the same time, this news can't be be taken as suggesting that Chinese firms have been squeezed out. Because Xiaomi, Huawei, ZTE, etc have been incrementally and continuously increasing their market share. And as Lenovo fully taps the potential of their Motorola assets, we will also see a burst of growth from them.

The real loser from these real developments is Samsung. They're getting squeezed on both sides of the market: high-end and low-end.

 

[BoQ77]

Apple notches huge sales in China during Q1

The iPhone 6 and 6 Plus helped the company generate $16.2 billion, or 22 percent of its revenue, from China.

Oh, not billions but 16.2 billions dollars for just Iphone 6 and + ; don't forget other versions of Iphone and Ipad.

 

[opruh]

Wow so now Xiaomi is in 2nd place.

 

[TaiShang]

As long as foreign firms don't run afoul of Chinese regulatory authorities by playing by the rules and working purely for their own commercial interests and not foreign political interests (like Google did), they have the potential to do very well in the Chinese market. The Chinese luxury goods market is an example of a market dominated by foreign firms. Chinese firms that hope to nab their own slice of their pie in this sector will not be able to rely on the state: they will have to push ahead by their own merits through marketing and quality refinement.

Anyway, Apple is an aspirational product for many Chinese and their Chinese marketing campaign has been very effective - they have some very savvy people analyzing for them exactly what Chinese consumers want. At the same time, this news can't be be taken as suggesting that Chinese firms have been squeezed out. Because Xiaomi, Huawei, ZTE, etc have been incrementally and continuously increasing their market share. And as Lenovo fully taps the potential of their Motorola assets, we will also see a burst of growth from them.

The real loser from these real developments is Samsung. They're getting squeezed on both sides of the market: high-end and low-end.

Exactly.

Abide by the rules, and the pasture could not be any greener. LOL.

Xiaomi's Mi Note sells out in under three minutes - CNET

Wow so now Xiaomi is in 2nd place.

For 2014 Q4, yes. Not for the entire year, of course.

 

[Established_1965]

I'm not sure if you are familiar with the smartphone industry, but iphone 6 is not original, bigger size, better camera, and all that, that's not only from other Android phones, it's also not as good, compare it with other phones that came before and since.

We are paying that Cold War Winner royalty check to Uncle Sam.

Fo you it's more about size, camera and so on. For people like me it's more about how a smartphone can increase my productivity. I personally prefer iOS and Android(NEXUS model only)

 

[BoQ77]

Fo you it's more about size, camera and so on. For people like me it's more about how a smartphone can increase my productivity. I personally prefer iOS and Android(NEXUS model only)

Just like Windows for desktop and laptop. Does Chinese love Windows ?

 

[Beidou2020]

Lets see how long Apple can stay at number 1 considering the rise of Chinese brands.

 

[TaiShang]

Lets see how long Apple can stay at number 1 considering the rise of Chinese brands.

The competition is fierce and will only get fiercer. The Q1 results will be of great interest.

 

[Keel]

People who gets frustrated and suspicions of any infringements of their IP rights by competitors can best resort to the courts than to present themselves on forums as miserable whiners on China's challenges.

Apple notches huge sales in China during Q1

The iPhone 6 and 6 Plus helped the company generate $16.2 billion, or 22 percent of its revenue, from China.

The iPhone 6's big screen has pushed Apple to big results in China, with quarterly sales in the region topping $10 billion for the first time.
Apple generated $16.1 billion in revenue in Greater China in the fiscal first quarter, up 70 percent from the same period a year ago. In mainland China alone, sales more than doubled from the previous year. Greater China -- which includes mainland China, Hong Kong and Taiwan -- represented 22 percent of Apple's total sales during the quarter ended December 27, and it was Apple's second-biggest iPhone market after the US.

"I was there right after the launch in October, and the excitement around the iPhone 6 and 6 Plus [was] absolutely phenomenal," Apple CEO Tim Cook said Tuesday during a call with analysts. "You can tell that we're a big believer in China."

The company plans to double its number of stores in Greater China to 40 by mid-2016, he added. Apple's traction in the region pushed the company to its biggest quarter ever. The company said Tuesday it sold 74.5 million iPhones in its fiscal first quarter, up 46 percent from its prior all-time high a year earlier.

The update follows a report from market research firm Canalys earlier Tuesday that said Apple became the biggest smartphone vendor by shipped units in China during the December quarter. Apple gained the title for the first time in its 38-year history, the firm said, surpassing Chinese vendor Xiaomi at No. 2 and South Korean giant Samsung at No. 3. Huawei nabbed the fourth-highest market share during the December quarter.

A year earlier, Apple held the No. 6 position in China, Canalys said, and its highest position in the previous seven quarters was No. 4 in the first calendar quarter of 2014.

The firm attributed Apple's position to the "incredible popularity" of the iPhone 6 and iPhone 6 Plus and said the market share gain was "an amazing result" given the retail price of the iPhone is much greater than that of phones made by Chinese vendors.

"While Chinese smartphone vendors are quickly gaining ground internationally, Apple has turned the tables on them in their home market," Canalys said.

Emerging markets represent a critical source of growth for everyone from giants such as Apple and Samsung to newcomers like Xiaomi. China became the world's largest smartphone market in 2011 and now is home to almost 520 million smartphone users. Apple has been working to gain market share in the country by reaching deals with major carriers in the region. An agreement with the world's largest carrier, China Mobile, proved challenging but was key as it provides access to more than 800 million subscribers.

Apple's China sales neared $10 billion only one other time before, in last year's fiscal second quarter ended March 29, the first period that incorporated sales from China Mobile. The deal between the two companies went into effect in January 2014. In 2011, Apple made only $12.5 billion from China the entire year. The year before, it made only $2.8 billion. Fiscal 2014's China sales totaled $29.8 billion.

The company generates more than half its revenue from its smartphone business, and the fiscal first quarter, which ends in December, is typically Apple's biggest quarter of the year because of holiday sales and the recent introduction of the latest iPhones.

This year's fiscal first quarter marked Apple's first full period of 4.7-inch iPhone 6 and 5.5-inch 6 Plus sales. The company said sales for the period ended December 27 jumped 30 percent to $74.6 billion, well above the $67.69 billion projected by Wall Street. (The last record quarter for sales was 2014's fiscal first quarter with revenue of $57.6 billion.) Apple said it sold more units at launch than any previous iPhone model.

Emerging markets used to be one of Samsung's strong points. The company has long battled Apple over pricey, high-end devices, but it dominated in lower-cost sectors where Apple doesn't play. Samsung largely gained its strong position in places like China by offering old, cheap smartphones. But it made a big miscalculation: consumers in emerging markets didn't want old, inferior technology. They wanted high-end devices with low-end prices. Xiaomi and other companies met that need, rapidly boosting their market share at Samsung's expense.

Samsung dominated the Chinese smartphone market for 10 straight quarters before Xiaomi knocked the Korean company out of its position. The shift started in the second quarter of 2014, according to Strategy Analytics.

Samsung didn't respond to a request for comment on the Canalys report.

Apple notches huge sales in China during Q1 - CNET

This is another way of telling the US cry babies at the parliament to shutup before another pouring of abusives on their trade deficits with China

 

[BoQ77]

This figure show us two cute facts :
1. Chinese love Apple products
2. Chinese is getting richer.
------------
In other side :
1. By this American still get big money without any export to China.
2. American created jobs for Chinese : workers, sellers, ...

 

[cnleio]

Oh and by the way, iPhone 6+ sells at twice the rate in China then what it sells here in States.

It means now China is the 1st biggest customer for U.S Apple company, much larger than U.S.

 

[mike2000]

Great achievement by apple. But then again, we shouldn't be surprised. Apple is not even a company anymore its now transcended that to become more like a cult. Since you will hadly see apple fans/user change to another brand/smartphone compared to other smartphone users. Also apple is the worlds biggest tech company by at, its also the most valuable company out there, yes more than eben petrol rich Exxon. Its market valuation more than the GDPs of big middle sized powers and it also has strong IP rights etc which brings it billions of dollars in revenues. Its handsets are considered bove tier 1 I.e in their own league before others come behind. All this makes apple a unique brand /company. Its nearest competitor Samsung, though a behemoth its revenues and valuation still.lag way behind apple. Aplle is regarded as top tier in evey country out there, without exception. To match apple and its quality is a really daunting task I must confess.
Kudos to the Cupertino based behemoth who. Created all by itself a new industry which others are now thriving under and changed the way we all communicate/use our mobile phones.

 

[MohitV]

price of an iphone 6+ in china ?