Apple reports higher sales as China reopens but gives no forecast

Apple reported sales and profits that beat Wall Street expectations on Thursday, with chief executive Tim Cook saying China sales were "headed in the right direction" as that country reopens after Covid-19. But Mr Cook said it was impossible to forecast overall results for the current quarter because of uncertainty created by the virus.

With its global brand, few American companies have been exposed to the spread of the coronavirus like Apple, whose iPhone sales declined in the March quarter as device sales were forced to online-only in many places. Sales of services such as streaming television content rose with billions of people locked in their homes. China, where the virus was first detected, is both a major market for Apple, supplying about a sixth of its overall sales, and is also home to most of Apple’s contract factories.

Apple saw China sales of $9.46 billion (€8.6 billion), down less than a $1 billion from a year ago, a potential sign of how the company will fare as other markets emerge from lockdowns.

‘Steep falloff’

“When the lockdown went into effect at the end of January, we saw a very steep falloff in demand for the month of February,” Mr Cook said. Apple slowly reopened Chinese stores, with all running again by mid-March. “As compared to February, we saw a nice improvement in March and a further improvement in April. China is headed in the right direction.”

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Apple reported sales of $58.3 billion and earnings of $2.55 per share for its fiscal second quarter ended in March, above equivalent 2019 results of $58 billion and $2.46, and above analyst estimates of $54.5 billion and $2.27. Apple shares, which closed up over 2 per cent, rose another 1.5 per cent to $298.38 in extended trading. – Reuters