Apple's strong Q3 results marred by 10 percent hit in China from iPhone competition

Posted:
in iPhone edited August 2017
Apple's otherwise solid June-quarter results were held back by a 10 percent year-over-year revenue drop in China, likely caused by the iPhone's slipping position in the local market.




"Greater China" revenues fell from $8.848 billion to $8.004 billion, according to Apple's filings with the U.S. Securities and Exchange Commission. The company was also down from $10.726 billion in Q2 2017, but the June quarter is typically a slow period as few products are launched and many shoppers wait for new iPhones in the fall.

Apple is just barely holding on to fifth place in the Chinese smartphone market, according to Canalys estimates. The top four spots are held by local Android-based brands Huawei, Oppo, Vivo, and Xiaomi.

The main issue is likely price, since Apple doesn't offer any low- to mid-range phones apart from older models. Its competition being local and Android-based may offer a further cost advantage, even though many Apple supply and assembly partners are based in the country.

Globally Apple took in some $45.4 billion in revenue during the June quarter, driven by sales of over 41 million iPhones. China was the only region to see a decline, despite one-time predictions that it would eclipse the Americas. In fact the latter saw revenues climb 13 percent year-over-year to $20.376 billion, and Europe grew 11 percent to $10.675 billion.

Comments

  • Reply 1 of 9
    rob53rob53 Posts: 3,010member
    Doesn't surprise me. Cheap phones will always outsell iPhones but I'd like to know if there are any stats on how long Chinese buyers are keeping their iPhones before rebuying. That market might not have gotten to the point where the majority of iPhone owners are ready for an upgrade.
    watto_cobra
  • Reply 2 of 9
    brucemcbrucemc Posts: 1,541member
    I think if Apple would update the iPhone with some China specific colours (a different one each year) that would have a meaningful impact on sales...  It is all about what is new there...
  • Reply 3 of 9
    AI_liasAI_lias Posts: 428member
    I'm still an iPhone owner, but I'm hanging on to it longer, due to price. I can only imagine in China price being even more of an issue. Let's be honest, there's only so far you can go in market share at these prices. Apple will probably make the 7 available there cheaper, after 7s and 8 are released, which is probably the best idea. So, they'll go more expensive (8 or X) and less expensive (7), with 7s in the middle.
    edited August 2017 jbdragon
  • Reply 4 of 9
    Big deal. Upgrade cycles are slower in poorer countries. I am guessing it's greater than two years in China.

    I predict that sales of the iPhone 8 in China will go through the roof.
    watto_cobra
  • Reply 5 of 9
    tzeshantzeshan Posts: 2,351member
    Why the media never know this fact? China like India impose huge import tax on iPhone despite being manufactured in China. Samsung was hurt for the same reason in China. Don't you notice Samsung is not even in the top five despite being the largest smartphone maker in the world? 
    jony0watto_cobra
  • Reply 6 of 9
    tgr1tgr1 Posts: 33member
    Big deal. Upgrade cycles are slower in poorer countries. I am guessing it's greater than two years in China.

    I predict that sales of the iPhone 8 in China will go through the roof.
    WIth 8 being a lucky number, I wonder if it will indeed be called iPhone 8 or iPhone Pro as some are suggesting.
  • Reply 7 of 9
    jbdragonjbdragon Posts: 2,246member
    AI_lias said:
    I'm still an iPhone owner, but I'm hanging on to it longer, due to price. I can only imagine in China price being even more of an issue. Let's be honest, there's only so far you can go in market share at these prices. Apple will probably make the 7 available there cheaper, after 7s and 8 are released, which is probably the best idea. So, they'll go more expensive (8 or X) and less expensive (7), with 7s in the middle.
    I had my iPhone 4 for just over 4+ years before getting my iPhone 6, which I'm in my 3rd year with and starting year number 4 is coming up fast. I still have my iPad 3 though it's really poky. Looking to get a 10.5" iPad Pro. Though the larger one is temping. WIll I get the new iPhone 8? I have no idea. I don't make plans based on RUMORS. So I'll wait for Apple's annoucment and real facts and at that time make up my mind. As for China, I think the iPhone will continue to take a hit. Just for the simple fact of Apple now blocking VPN's in the App store. So unless you go through the trouble of Jailbreaking the iPhone, which most don't, they're going to just buy a cheaper Android phone and side load VPN software. That's simple enough to do.
  • Reply 8 of 9
    robjnrobjn Posts: 266member
    The information on the earnings call and year over year growth figures tell a very different story than the one you paint with your cherry-picked number.
  • Reply 9 of 9
    RacerhomieXRacerhomieX Posts: 95unconfirmed, member
    jbdragon said:
    AI_lias said:
    I'm still an iPhone owner, but I'm hanging on to it longer, due to price. I can only imagine in China price being even more of an issue. Let's be honest, there's only so far you can go in market share at these prices. Apple will probably make the 7 available there cheaper, after 7s and 8 are released, which is probably the best idea. So, they'll go more expensive (8 or X) and less expensive (7), with 7s in the middle.
    I had my iPhone 4 for just over 4+ years before getting my iPhone 6, which I'm in my 3rd year with and starting year number 4 is coming up fast. I still have my iPad 3 though it's really poky. Looking to get a 10.5" iPad Pro. Though the larger one is temping. WIll I get the new iPhone 8? I have no idea. I don't make plans based on RUMORS. So I'll wait for Apple's annoucment and real facts and at that time make up my mind. As for China, I think the iPhone will continue to take a hit. Just for the simple fact of Apple now blocking VPN's in the App store. So unless you go through the trouble of Jailbreaking the iPhone, which most don't, they're going to just buy a cheaper Android phone and side load VPN software. That's simple enough to do.
    You do realize ,one can just use 1 of the many more VPN providers that weren't blocked. Or you could just sign into UK or US app store. Most folks who need VPNs already have it
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