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Apple Points China's Weakness for Low Sales Volume after Falling Short

By January 27, 2016 at 2:31 am
Next iPhone might feature flexible screens (Photo : Justin Sullivan/Getty Images)

Apple experiences China's economic slowdown as their sales volume went lower than expected.

Apple Inc. admits lower-than-estimated sales in the last quarter, and lower than Wall Street's sales forecast, in lieu with China economic slowdown, according to The Star. The Cupertino giant's shares zoomed down to 5 percent this year, but went up to 0.4 percent at $100.42 after trading.

The company stated on Tuesday that it vended 74.8 million iPhones during the first fiscal quarter of iPhone 6s and iPhone 6s Plus. Though it achieved 0.4 percent growth, it is still tagged as the lowest since 2007.

In an interview with Reuters, Apple Chief Financial Officer Luca Maestri admitted decline of sales due to China's economic struggle despite a rise of 14 percent revenue during the first quarter.

"As we move into the March quarter it's becoming more apparent that there are some signs of economic softness," said Maestri. "We are starting to see something that we have not seen before."

The news is not surprising. Analysts have been speculating about the company's performance during China's struggle. As one of Apple's top market, their economic slowdown will inevitably pull down sales. Apple estimated a $50 billion to $53 billion revenue in the second quarter, which is below the $55.6 billion forecast of analysts.

According to FactSet StreetAccount, Apple's shipment did not meet the expected 75.5 million. During the first quarter, their net profit went up from $18.02 billion to $18.36 billion, earning them 1.7 percent increase.

Also, during the holiday season, iPhone shipment was reportedly lowest since 2013 when they climbed to 6.8 percent, according to Statisca.

In Greater China alone, the Cupertino giant made $18.37 million, which accounts for 24.2 percent revenue in total. The revenue almost doubled during the fourth quarter.

Apple said they earned $80.8 billion in adjusted basis. 

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