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Apple Up 1%: Wearables And Streaming Offset Fall In China

Apple has posted mixed results for Q1 2020, with higher demand for wearables and services offsetting the drop in iPhone and Mac sales for overall revenue growth of 1%. “The last part of March and the first part of April were very depressed and then we’ve seen a pickup relative to that period of time in the second half of April,” Apple CEO Tim Cook told Bloomberg.

Investors were quick to notice that Apple did not provide a quarterly forecast in its earnings announcement, something the company hasn’t done in over a decade. Bloomberg reported that shares slipped 1.5% in extended trading following this.

Net iPhone sales fell by 2.9% year-on-year (y-o-y) to $5.35 billion, while Mac sales were down 10.3% y-o-y, at $4.37 billion. Overall, Apple’s net sales totalled $44.97 billion.

The only two regions where Apple had a fall in net sales were Greater China and Japan, with sales declining y-o-y by 7.5% (representing $763 million less in sales) and 5.9% (-$326 million), respectively.

A man wearing a mask walks past an Apple Store in Hong Kong, Wednesday, Feb. 19, 2020. (AP Photo/Kin Cheung)

In addition to dampening demand in China, the COVID-19 crisis also impacted Apple’s supply chains significantly, as the company manufactures many of its products there. Apple is reportedly delaying the mass production of its upcoming iPhone 12 by a month.

“Despite COVID-19’s unprecedented global impact, we’re proud to report that Apple grew for the quarter, driven by an all-time record in Services and a quarterly record for Wearables,” Cook said.

This demand for wearables is in line with other quarterly earnings reports, with Garmin recording a 24% hike in wearables sales.

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