China Ruins Apple’s Quarter

By Douglas A. McIntyre Published Nov 1, 6:25AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

China Ruins Apple’s Quarter — © JohanSjolander / E+ via Getty Images

24/7 Wall St. Insights

The latest quarterly results reveal that Apple Inc. (NASDAQ: AAPL | AAPL Price Prediction) is doing poorly in China.
China is by far the world’s largest smartphone market.
Also: Dividend legends to hold forever.

Based on analysts’ comments and the mediocre performance of its shares, Apple Inc. (NASDAQ: AAPL) had an average quarter. It still trades below the S&P 500 this year, which is unusual. Traders are probably waiting for the next report to see how the iPhone 16 is doing. When teased apart, its divisions showed an alarming fact: Apple is doing poorly in China.

China is by far the world’s largest smartphone market. About a billion people in China have smartphones, compared to just over 300 million in the United States.

Apple’s overall revenue rose 6% for the quarter to $94.9 billion, and per-share earnings rose 12% to $1.64. Revenue from its promising Services business hit $24.97 billion, up from $22.31 billion. That means its annual run rate is over $100 billion. That is almost better than Mac, iPad, and Wearables combined.

Greater China revenue was flat at just over $15 billion, barely half Apple’s revenue in Europe.

The China figure shows that the iPhone maker has not successfully competed with the large smartphone companies in the world’s largest country by population. Based on phones shipped, Apple was second to Vivo in the third quarter. It was barely ahead of Huawei and Xiaomi. The three Chinese companies grew during the quarter, year over year, while Apple’s shipments were flat.

When Apple announces figures for the current quarter, investors will examine iPhone 16 sales and whether the iPhone picked up enough market share in China to make it the smartphone leader there.

Apple Stock Price Prediction and Forecast 2025-2030

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.