Apple's iPhone Sales Face Challenges in the Americas and China, but Services Business Shines

Photo:ft.com

Apple's iPhone sales are expected to encounter some challenges, particularly in the Americas, where revenue is anticipated to decline by 6%, according to analysts. Meanwhile, sales in China, Apple's third-largest market, are predicted to remain flat due to an uneven economic recovery. However, Apple has managed to outperform its Android rivals in the country.

 

Market research firm International Data Corp. reported that overall smartphone shipments to China fell by 2.1% in the second quarter. Despite concerns about a soft market in China, analysts at Piper Sandler believe that Apple's position in the country remains strong, and any decline in iPhone sales is likely to be minimal, if at all. Furthermore, any potential weakness in China could be offset by robust sales momentum in India.

 

Refinitiv data indicates that Mac and iPad sales are expected to experience declines of 10.6% and 11.2%, respectively. However, there is a glimmer of hope in Apple's services business, which encompasses the App Store, as well as audio and video streaming services. This segment, accounting for roughly a quarter of Apple's total revenue, is projected to grow by 5.7%. Analysts attribute this growth to an uptick in the ad market and price increases for iCloud subscriptions. Although the pace of growth is comparable to that of the preceding three quarters, the services business appears to be a bright spot amid challenges in other product categories.

 

Apple remains cautiously optimistic about its overall performance, with analysts emphasizing that while certain regions may face hurdles, the company's strategic position and diverse product portfolio are expected to drive its continued success in the global market.

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