Apple Inc. provided a reassuring revenue forecast for the first quarter, which helped to bolster investor confidence despite a mixed earnings report for the holiday quarter. The company reported a 7.1% increase in net income for the fourth quarter, but this was overshadowed by a significant 11.1% decline in iPhone sales in China, a key market for the tech giant. CEO Tim Cook attributed the sales drop to delays in rolling out Apple Intelligence in China and inventory challenges. "Our channel inventory reduced from the beginning of the quarter to the end of the quarter," Cook explained, highlighting the impact of inventory issues on sales performance.
The decline in China sales, which reduced Apple's revenue to $18.51 billion in the region, was the largest drop since the first quarter of 2024. This decline was compounded by fierce competition from local smartphone manufacturers like Huawei, Vivo, and Oppo. Despite these challenges, Apple's positive revenue projections for the upcoming quarter, which align with analyst predictions of about 5% growth, have provided some relief to investors. The company’s focus on AI features in its latest iPhone 16 series is seen as a potential driver for future growth, although the staggered rollout of these features has been criticized by some analysts.
Apple's stock closed at $236 on January 31st, down 0.67% from the previous close of $237.59, with an after-market decline of 0.31% to $235.27. The stock experienced significant volatility, with a high of $247.19 and a low of $233.44, on a trading volume that was 188.52% of its average.