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Apple’s earnings surge, as iPhone sales jump and China business rises


The company said on Monday that quarterly iPhone sales in greater China, which includes mainland China, Hong Kong and Taiwan, had surpassed those in Apple’s home market, the United States, for the first time.


While Apple did not disclose specific numbers, the performance powered the company’s revenue, with sales in greater China rising 71 percent to $16.8 billion in the fiscal second quarter compared with the same period last year. Revenue from greater China also exceeded that from Europe for the first time.


The China results punctuated another strong quarter for Apple. In total, revenue climbed 27 percent to $58 billion, up from $45.6 billion last year, the company said in its earnings report. Profit was $13.6 billion, up from $10.2 billion a year ago.


“Everything you look at in China was extremely good,” Timothy D. Cook, Apple’s chief executive, told analysts in the company’s earnings call. “We’re really proud of the results there and continue to invest in the country.”


Apple has long laid the groundwork to reap big sales in China, and revenue growth from the region has steadily gained momentum. The company in late 2013 struck an important deal to sell iPhones through China Mobile, the world’s largest phone carrier. Apple is also expanding its operations in the region, with 21 retail stores and plans to increase that number to 40 by mid-2016.


Add to all that the fact that the Chinese New Year holiday, typically a big retail season, was in February. The latest iPhones also have much bigger screens than past models, another feature that has been especially popular in China.


Jan Dawson, an independent technology analyst for Jackdaw Research, said Apple’s performance in China highlighted its advantages against other American technology companies.


“It’s hugely important because it shows that Apple continues to be the only major U.S. tech company that is really succeeding in China, in contrast to Google, Microsoft and Amazon,” Mr. Dawson said.


Over all, Apple sold 61.2 million iPhones in the quarter, beating analysts’ estimates of roughly 60 million phones. That also far exceeded the 43.7 million iPhones that Apple sold in the period a year ago. Analysts had anticipated that iPhone sales would increase sharply, largely because of the company’s growing presence in greater China. Apple also said it was seeing a higher rate of people switching to iPhones from Android smartphones.


Apple also sold 4.6 million Mac computers in the quarter, up from 4.1 million a year ago. Mr. Cook said Mac sales in China rose 31 percent from a year ago.


“The iPhone is not going to grow this rate forever in China or globally,” he said. “What’s next, given that Mac is small and iPad is declining?”



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