Business
Apple posted stellar second quarter results on Tuesday, driven by demand from China. Apple’s growth engine has now shifted unmistakably to China, writes the New York Times. The company said on Monday that quarterly iPhone sales in greater China, which includes mainland China, Hong Kong and Taiwan, had surpassed those in Apple’s home market, the United States, for the first time. While Apple did not disclose specific numbers, the performance powered the company’s revenue, with sales in greater China rising 71 percent to $16.8 billion in the fiscal second quarter compared with the same period last year. Revenue from greater China also exceeded that from Europe for the first time. The China results punctuated another strong quarter for Apple. In total, revenue climbed 27 percent to $58 billion, up from $45.6 billion last year, the company said in its earnings report. Profit was $13.6 billion, up from $10.2 billion a year ago.
Still, Apple said only 20% of iPhone customers have upgraded to an iPhone 6 or iPhone 6 Plus so far, meaning Apple's streak of mind-blowing sales shows no signs of abating, notes CNN Money. Mac, iPad and iTunes. The company also sold 4.6 million Macintosh computers, and it posted record sales for the iTunes App Store. But Apple sold a disappointing 12.6 million iPads last quarter -- fewer than expected. That follows a general downward trend for the iPad -- and tablets in general -- as smartphone screen sizes get bigger. Still, Apple contended that the iPad is well-positioned for long-term growth, noting that the number of people who say they want to buy an iPad and still haven't purchased one is large. Though the iPad has been a disappointment, the success of the giant iPhone 6 Plus has been a big boost to Apple. The $100-more expensive iPhone 6 Plus helped Apple's gross profit margin grow year-over-year, reversing a years-long downward trend.
Shares of the most valuable publicly traded U.S. company - which have risen more than 60 percent in the past year - hit a record high of $134.54 in early trading on Tuesday, reports Reuters. The stock later slipped to trade 0.5 percent down at midday. But few analysts expressed any doubts about Apple's prospects on Tuesday after the company comfortably beat Wall Street's revenue and profit forecasts.
"With a lot of good news baked into shares, we are seeing some investors take a pause," FBR Capital Markets analyst Daniel Ives told Reuters. "We fully believe shares have significant upside from here." Some analysts and investors had worried that iPhone sales may have peaked in the first quarter, when sales hit 74.5 million. The company sold 61.2 million iPhones in the latest quarter, beating the average analyst estimate of 57.3 million, according to market research firm StreetAccount.
