Today is the 28th birthday of the Mac, but it’s not a day of celebration for Apple. The firm’s stock opened below $500 again and continued to fall as investors punished the company for missing heady analyst expectations for the holiday quarter. The stock was down over 10 percent Thursday, flirting with $450 per share.
Apple turned in record revenue, iPhone and iPad numbers. But that wasn’t enough to offset concerns about slow profit growth that have contributed to the narrative that Apple’s lost its edge — a storyline that Apple’s clearly trying to nip in the bud.
Chief executive Tim Cook made a point to combat that idea during Apple’s Wednesday earnings call.
“Apple is in one of the most prolific periods of innovation in its history,” he told analysts. He pointed to the fact that the company has refreshed nearly ever product it produces in the past year, from the Mac to the iPhone.
“We rely on the same spirit and drive that brought the original Mac and other revolutionary products like the iPod, iPhone and the iPad into the world,” Cook said.
Yet while Apple explained lower-than-expected revenue by pointing to problems with the company’s supply chain, it did little to calm worried investors.
One bright spot in the company’s earnings report was news out of China, which Cook expects will soon become the company’s top market. The company, reflecting that expectation, has even broken out “Greater China” as its own operating segment in its breakdown of global sales. The region includes mainland China, Hong Kong and Taiwan.
Cook said that growth in China had grown 60 percent over the same period last year and that iPhone growth, particularly, was in the “triple digits.” He said that Apple would continue to expand its retail presence in China and that the company had expanded from 7,000 points of sale for the iPhone to 17,000 in the past year alone.
China is a more price sensitive market for smartphones, and picking up customers in that market is one of the main reasons that some say Apple should release a cheaper iPhone.
Bryan Wang, an analyst with Forrester, told the Post that Apple has a lot of room for growth in China, particularly if it strikes a deal with the country’s largest carrier, China Mobile.
Getting China Mobile to provide subsidies for the company’s smartphones and to update its network to allow for 4G models of the iPhone, he said, is vital for Apple’s future success in that market.
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