“Additionally, when you take into account the $3.6 billion channel inventory reduction in the June quarter and about $500 million last year, the revenue decline would also have been 8% for the whole company. So when you remove Greater China’s revenue decline, the Rest of the World’s revenue increased 0.6% year over year,” Jones writes. “So in one aspect (yes, it is a slice-and-dice analysis, but still worthwhile), Apple actually saw its revenue increase.”
“Greater China generated $8.8 billion in revenue, the lowest since the September 2014 quarter, and fell to the third largest geographic segment for the company since the December 2014 quarter. Its revenue decline of 33% year over year accelerated from 26% in the March quarter,” Jones writes. “However, management said, by far, the largest portion of the channel inventory reduction was in this region. If you assume $2.5 billion of the $3.6 billion was from here, the revenue decline would have only been 14%.”
Much more in the full article – recommended – here.
MacDailyNews Take: The doom and gloom over Apple’s China business is overwrought.
During the past quarter I visited China and India, and I am very encouraged about our growth prospects in those countries. We remain very optimistic about the long-term opportunities in Greater China and we continue to invest there. We opened our 41st Greater China retail store during the quarter, and we also made a $1 billion investment in Didi Chuxing.
Switchers and first-time smartphone buyers represented the lion’s share of our iPhone sales in the quarter, and our installed base of iPhones in China has grown by 34% over the last year alone. According to China Mobile, there are more iPhones on their network than any other brand, with iPhone users ranking first in terms of customer loyalty, data usage and ARPU. By far, the largest portion of our global channel inventory reduction was in Greater China, so our underlying business there is stronger than our results imply. — Apple CEO Tim Cook, July 26, 2016