updated 06:27 pm EDT, Tue April 23, 2013
Apple notes growth above expectations, 138 percent iPad growth
Amidst generally positive numbers presented by Apple in its quarterly earnings conference call, Apple CEO Tim Cook and CFO Peter Oppenheimer presented some facts about the burgeoning smartphone market in China. When presented a question by an analyst questioning Apple's present and future success in China -- considering that it doesn't yet sell the iPhone on the largest carrier in the country -- Apple claimed to have its "best quarter ever" regionally.
Apple's head says that Chinese revenue was $8.8 billion, which is up 11 percent year-over-year. Sales of the iconic iPad grew a whopping 138 percent in the same time frame. Both the iPhone and iPad had record sell-through rates in stores throughout the country.
Cook and Oppenheimer noted that Apple maintained 11 stores in China, with a doubling expected in less than two years. The existing stores are seeing a large amount of first-time smartphone buyers.
The iPhone 4 and iPhone 4S were available in China in October of 2010, with the iPhone 5 commencing sales on December 7 of 2012, thus this last quarter is the first full quarter the new device was available in the country. Cook called comparing the year-over-year situation challenging, given the "different set of dynamics" in device availability.
Also hindering iPhone sales in China is Apple's failure to secure a deal with China Mobile, the largest provider in the country with nearly a billion customers. Both companies have indicated that a deal should eventually be reached, but have never provided a timeline or clarified the obstacles preventing the company from including the iPhone.
Apple's conference call made a large number of references to the powerful Apple ecosystem -- which is weaker in China than in the US, and is expected to remain so given the economic and political climate. Additionally, the CFO noted that Apple makes profits well past device sales in all markets, including China -- despite lower-than-average post-hardware purchase app sales. While individual numbers weren't provided, Apple "is pleased" with financial results and future earnings potential in the country.