Roger Fingas
Apple CEO Tim Cook on Monday issued a rare mid-quarter update on the company's performance, saying Apple is continuing to experience "strong growth" in China as he tried to assuage fears about the impact of the Asian nation's economic slowdown.
"I get updates on our performance in China every day, including this morning, and I can tell you that we have continued to experience strong growth for our business in China through July and August," Cook wrote in an email to CNBC's Jim Cramer, which was later posted on Twitter by fellow anchor Carl Quintanilla.
"Growth in iPhone activations has actually accelerated over the past few weeks, and we have had the best performance for the App Store in China during the last 2 weeks," Cook continued.
Apple's chief executive went on to claim that quarterly performance has so far been "reassuring," and that Apple stands to gain in China in the long-term as the middle class expands and access to faster LTE networks grows.
The Chinese economy has slumped dramatically in recent weeks, prompting the government to take a series of steps — Â including repeated devaluations of the yuan — Â designed to stabilize the situation. Those measures appear to have been only marginally effective, and the continued slide has dragged markets around the world down with it.
On Friday, Apple shares fell into bear territory for the first time in years, one of a number of tech stocks battered by the Chinese uncertainty. Apple dropped even further in pre-market trading earlier Monday, opening at just $94.87 before rebounding back over $104.
The Dow Jones Industrial Average — of which Apple is a key component — dipped 1,089 points after Monday's opening bell, though the decline eased to 600 points within 30 minutes of active trading and the index was down just 400 points at press time.
AppleInsider Staff
Chip Loder
Christine McKee
Malcolm Owen
William Gallagher
Andrew Orr
90 Comments
AAPL hit a 52-week low of $92, but still didn't quite reach my limit of $90. Why does Tim talk to carnival barker Jim Cramer anyway? The man is a clown.
1) Perhaps it's a [I]post hoc[/I] fallacy but that appears to have reversed most of the pre-market drop. 2) I see this issue in China like the 2008 recession in the US. This will not have any effect on Apple. Those that want Apple's products in China will still be able to buy them. China isn't Greece.
I think that, a month or two from now, people will look with regret not jumping in at these prices. 8.3x current PE ratio ex-cash; probably 6.5x forward PE.
Insane.
I hope Apple is buying back the heck out of its shares at these levels, about 30% below recent highs. Even if it means paying the extra 10-15% or so in US taxes by bringing its cash back from abroad. There's no need to even do a detailed calculation.
Go and google Greece's avg hoours worked per year in comparison to Germany before calling them lazy. Don't confuse he country's financial issues with the people's willingness to work. [quote name="sog35" url="/t/187842/tim-cook-refutes-china-worries-calls-apples-growth-strong-in-rare-mid-quarter-update#post_2765099"]2000 - .com bubble burst. 2001 - Apple releases iPod 2007 - iPhone released 2008 - real estate crash 2015 - China 'crash' (not really a crash since China's GDP is still growing at 5-6% just not the 7% Wall St wants) 2015 - Watch, AppleTV Apple seems to always release ground breaking products during economic uncertainty. And every time it has had ZERO EFFECT on sales. The China concerns are ridiculous and overblown. China has over 1 billion people. And their culture is of EXTREME hardwork, unlike Greece and other Euro nations that are lazy. This lull in their economy is temporary. The China stock crash is overblown. Looking at one year returns its actually UP 43%. [/quote]
[quote name="quanster" url="/t/187842/tim-cook-refutes-china-worries-calls-apples-growth-strong-in-rare-mid-quarter-update#post_2765107"]Go and google Greece's avg hoours worked per year in comparison to Germany before calling them lazy. Don't confuse he country's financial issues with the people's willingness to work. [/quote] The problem with Greece was everyone was working for their government. Government isn't a profit center, it's a drain on an economy. Their misguided socialism caught up with them.