Apple announced its fourth quarter report on October 27, 2015, and this company posted “quarterly revenue of $51.5 billion and quarterly net profit of $11.1 billion, or $1.96 per diluted share.”(Apple). This result is quite impressive compared with compare to revenue of $42.1 billion and net profit of $8.5 billion, or $1.42 per diluted share, in the year-ago quarter. However, one thing should be noted, is the truth that Approximately 67% of Apple’s revenue growth comes from China. So China’s market plays a significant role in Apple’s business.
In my opinion, Apple’s success in Chinese market can be considered as a mixed signal because Apple might be too much overreliance of China. If markets in China shift away from Apple, what should Apple do?
Though Apple has occupied a huge market share value of China’s market, the truth is that there are more and more rivals are sharing this big pie in China. According to Fortune, Apple falls to 3rd Place in China Smartphone market with Xiaomi leading first and Huawei right behind. (Xiaomi and Huawei are both local companies in China.) So I think it is a warning for Apple that Chinese consumers are moving gradually towards to local smartphone market.
As a result, I think Apple needs to change its strategy by expanding markets in other countries, for example, some developing countries. And it is important for this company to be aware of overreliance in China. Meanwhile, this company should not give Chinese market in a short period of time because it still holds the majority of Apple’s revenue and still need to work on holding more market share value in China’s smartphone market.
resources:
http://fortune.com/2015/08/03/apple-third-place-china/
http://www.investopedia.com/articles/investing/102815/china-put-shine-apple.asp?utm_source=NTU&utm_medium=email&utm_campaign=NTU-10/30/15&utm_term=news-to-use
http://www.investopedia.com/articles/markets/110315/should-apple-investors-be-wary-overreliance-china.asp