Apple Inc. announced that its sales and profits improved and beat Wall Street analysts' expectations. The CEO of the company claimed that the company is headed in the right direction as China's economy reopens amid the pandemic.
Apple Inc. CEO Tim Cook revealed that the overall forecast results of the company's reported sales and profits in China were higher than market expectations. He claimed that the numbers did not add up since there remained uncertainty caused by the pandemic in the Chinese market during the first quarter of the year.
Some American companies, including Apple Inc., were adversely affected by the regulations imposed by the Chinese government to contain the pandemic. During the imposition, iPhone sales declined in March, and the company's device sales were only offered through online means. Sales of Apple's services, such as its streaming television content, on the other hand, significantly improved as billions of people acquire the service. The report claimed that the Stay-At-Home order generated a consumer behavior that benefited the online industry, including Apple Inc.'s streaming services.
Apple supplies about a sixth of its overall sales in China. The country was also referred to as the home of Apple's contract factories. This year, Apple's China sales reached a total of 9.46 billion USD, a billion lesser from 2019 values. Cook then added that lockdowns imposed in China since January resulted in a significant decrease in demand for Apple products in February. However, he noted that since the reopening of the Chinese economy, Apple Inc.'s values might have improved since mid-March.
Compared to February values, Cook hinted that there was a significant improvement for Apple's performance in the Chinese market. He also hinted that this April, its sales rose and claimed that the company is headed in the right direction.
The company's reported sales reached 58.3 billion USD, while its earnings were at 2.55 USD per share for the second fiscal quarter that ended in March. The results this year were more significant than the 58 billion USD sales and 2.46 USD per share values in 2019. The estimates for the values, according to analysts in Wall Street, were only 54.5 billion in sales and 2.27 USD per share for 2020. Hence, the IBES data from Refinitiv was lower than the actual yield of Apple Inc. during the first quarter of 2020 in China.
Apple shares also increased by two percent and further increased to 1.5 percent to 298.38 USD during the extended trading this week. Cook then added that during the first five weeks of the fiscal second quarter this year, Apple Inc. grew faster, yielding about 63 billion USD and 67 billion USD in sales.
