Apple’s China sales slump 3.6% despite overall quarterly beat

Apple Inc.’s quarterly results were overshadowed by a sharper-than-expected revenue slump in China, underscoring the company’s ongoing struggle to maintain momentum in a market that once powered much of its growth.

Revenue from Greater China fell 3.6% to $14.5 billion in the three months ended September 27, missing analyst expectations of $16.4 billion.

The shortfall raised fresh doubts about Apple’s competitiveness in a region where local smartphone makers, including Huawei and Xiaomi, have gained significant ground.

China’s weakness offsets a solid quarter

The disappointing China numbers contrasted with a steady overall performance. Apple reported total revenue of $102.5 billion for the quarter, edging past Wall Street forecasts of $102.2 billion.

Despite the slight beat, investor reaction was muted, with Apple shares little changed in late trading after the report. The stock has gained 8.4% so far this year.

The company’s inability to deliver growth in China has become a recurring concern for analysts and investors.

Once one of Apple’s most important markets, the region now represents a fierce battleground marked by intensifying competition and shifting consumer preferences.

Local rivals rise as AI gap widens

Chinese smartphone brands have capitalised on the growing popularity of AI-enabled devices, a segment where Apple has yet to unveil major breakthroughs.

Restrictions on advanced AI tools within China have also limited Apple’s ability to integrate its upcoming “Apple Intelligence” features into local products.

Industry observers say Huawei’s recent resurgence has further squeezed Apple’s share of the premium smartphone segment.

Huawei’s new Mate 70 series, with stronger domestic supply chains and advanced chip designs, has attracted consumers seeking local alternatives to the iPhone.

Meanwhile, Apple’s performance in other markets remained resilient, supported by stable demand for iPhones and continued growth in its services segment, which includes App Store revenue, Apple Music, and iCloud subscriptions.

No guidance for the current quarter

As usual, Apple did not provide formal guidance for the current quarter.

Executives are expected to offer further commentary during the company’s conference call, with investors looking for insights into early sales trends for the new iPhone 16 lineup and the coming holiday season.

The Cupertino-based company continues to emphasise product differentiation, ecosystem strength, and future investments in AI integration across devices.

However, China’s cooling performance highlights a difficult balancing act between maintaining global growth and navigating one of the world’s most competitive smartphone markets.

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