Apple’s China slowdown deepens despite overall sales rising again

(Bloomberg) — Apple Inc. reported a deep slowdown in China during the holiday quarter, even as overall iPhone sales were stronger than expected and the company returned to revenue growth.

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Sales in China fell 13% to $20.8 billion in the fiscal first quarter ended Dec. 30, the company said in a statement Thursday. That’s well below the $23.5 billion expected by analysts and was Apple’s weakest December quarter in the Asian nation since the first period of 2020.

“We are not happy with the decline, but we know China is the most competitive market in the world,” Chief Financial Officer Luca Maestri said in an interview with Bloomberg Television’s Emily Chang.

Shares fell more than 3% in extended trading after the report was released. They closed at $186.86 in New York on Thursday, down 2.9% this year.

Apple is struggling with slowing consumer spending in China and increasing government restrictions on foreign technology. The conflicts reduced overall revenue profit by 2.1% to $119.6 billion. Analysts on average had predicted growth of 1% to $118 billion.

Along with the growth, Apple avoided posting a fifth consecutive quarterly decline – a streak that would have been the worst since the 1990s decline. The iPhone was a bright spot during the period, exceeding analysts’ expectations.

The earnings report also comes on the eve of Apple launching the Vision Pro headset. The device marks the company’s first major new category since 2015, while taking Apple into unfamiliar territory: virtual and augmented reality. The $3,499 headset lets people watch 3D videos, play games and conduct more intensive meetings.

Chief Executive Officer Tim Cook also said that Apple will announce an…

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