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Apple: We're seeing 'softness' in China

IPhone 6 Plus ChinaGetty Images/Feng Li

Apple just reported its Q4 earnings, and the company’s CFO is attributing its disappointing revenue guidance to a “softness” in China and other parts of the world.

Apple expects $50-$53 billion in sales in Q1 2016, which is less than Wall Street wanted, and, at its midpoint, an 11% drop compared to the same time last year.

Analysts were looking for revenue guidance of $55.7 nillion, which would have been the first revenue decline in Apple’s modern history.

This was a bigger decline than that.

Luca Maestri, Apple’s CFO told Bloomberg that Apple is being affected by the economic climate in other parts of the world, particularly a “softness” in China, and especially Hong Kong.

“You need to take into account the business opportunities that we have, but also the realities of an economic environment that is not ideal right now,” he told Bloomberg’s Adam Satariano.

Apple’s guidance proved analysts’ theory that Apple might finally be running out of room to grow.

Although Apple’s revenue from China grew this quarter, Maestri’s comments and the guidance hints that the company doesn’t expect huge sales there next quarter:

Bii apple earnings by region 4Q15 lineBI Intelligence

And here’s a different view of revenue by region.

Bii apple earnings by region 4Q15 stackedBI Intelligence


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