In some welcome good news for Apple, Instinet analyst Jeffrey Kvaal writes in a new research note Tuesday that smartphone sales in China are faring far better than feared year-to-date amidst the COVID-19 coronavirus turmoil.
Kvaal notes that new Chinese government data show that smartphone sales for the year through February were down 9% year over year, less than half the 21% overall decline in retail sales. He adds that smartphone production volume was down 44% over the same period.
“This implies that smartphone sales have proven more resilient than other retail sectors and that channel inventory in China is low,” Kvaal writes. “The number of Covid-19 cases peaked in China on February 17. We consider this a positive data point for Apple, which contrasts with rising concern about demand beyond China.”
MacDailyNews Take: Hopefully, as Kvaal contends, “the worst is over for now in China,” with 100% of Apple Retail Stores now open in China and production expected to be at full strength by the end of this month.
More info on the Prevention & Treatment of Coronavirus Disease 2019 (COVID-19) via the U.S. CDC is here.