(Bloomberg) – Apple Inc. achieved a strong quarter in China by changing retail tactics and promoting a cheaper iPhone, becoming one of the few US tech giants to endure the country’s post-pandemic recovery despite tensions between Washington and Beijing.
IPhone shipments rose a staggering 35% in the April-June period, research firm Canalys estimates, leading to a 2% rise in Greater China revenue to $ 9.3 billion. Chief Executive Tim Cook said sales actually grew 6% in constant currency, driven by demand for Macs and iPads from millions now accustomed to working from home. Its superior performance in Greater China, Apple’s largest international market, boosted quarterly revenue well above Wall Street’s expectations.
Apple’s strength in the world’s No. 2 economy stunned analysts who have seen local consumers increasingly turn to local brands, at a time when Washington accuses people like Huawei Technologies Co. and ByteDance Ltd. of spy on or compromise national security. Huawei, the most direct company in Trump’s sights, eclipsed Samsung Electronics Co. in global smartphone sales for the first time in the last quarter, thanks in large part to a great deal of support from the home crowd.
Apple, whose China-based vendors employ more than a million people, was quick to adapt its tactics after Covid-19 emerged in February, turning to outside distributors after closing most of its stores. It also focused on online marketing and selling, taking advantage of the increase in Internet activity that followed a continuous national blockade.
The iPhone maker jumped on a plethora of online sales promotions organized by Alibaba Group Holding Ltd. and JD.com Inc. in June, traditionally one of several months of peak spending. Apple moved more than 500 million yuan ($ 72 million) of devices in a single day during JD’s “6.18” shopping marathon, the Chinese company said. It probably also benefited from the introduction of a lower-cost smartphone, the iPhone SE.
“Apple defied expectations in the second quarter. Your new iPhone SE was critical in the quarter, ”said Canalys analyst Vincent Thielke. “Apple is also demonstrating skills in acquiring new users.”
Read more: Apple crushes revenue, iPhone estimates pandemic demand
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