China is still dragging Apple down

Apple has suffered its first annual revenue decline since 2001. Though that means the company “only” generated $215.6 billion in the past year, the drop has still made plenty of analysts sceptical.

One of the biggest drags on Apple’s earnings has been China. After being touted as a major source of growth potential by CEO Tim Cook, and after enjoying big success there to start, Apple has suffered a continuous series of sales declines in the region over the past few quarters. This past quarter, its China sales fell 30%.

As this chart from Statista shows, the company’s dollar sales growth in China has dropped by $10.2 billion in the last year. Over that time, the iPhone has lost big swaths of market share to local upstarts like Oppo and Vivo. The company has also run into a number of regulatory issues with local officials.

On Thursday’s earnings call, Cook remained bullish, noting China’s wider economic struggles and saying the iPhone’s initial gains gave it further to fall than usual. The company is confident iPhone 7 and 7 Plus sales will give it a boost. And if the 2017 iPhone is as mindblowing as its already massive hype suggests, that should only help.

But there’s a reason Cook and company are putting more eyes toward India: The sharks want growth, and Apple hasn’t really shown how it’s going to get more of it from its former cash cow.

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