'China represents an unprecedented opportunity': Apple's Tim Cook unfazed by market rout
With Apple shares down almost 10 per cent on Monday on fears that China's economy is on the downturn, chief executive Tim Cook might be forgiven for showing some concern.
However, in a note to Jim Cramer, host of CNBC investment show Mad Money, Cook said Apple "continued to experience strong growth for our business in China through July and August", two months in which the country's stock markets fell by more than 20 per cent, wiping out all gains made during the year.
"Growth in iPhone activations has actually accelerated over the past few weeks, and we have had the best performance of the year for the App Store in China during the last [two] weeks," Cook said.
"I continue to believe that China represents an unprecedented opportunity over the long run as [4G] penetration is very low and most importantly the growth of the middle class over the next several years will be huge."
Cook's bullishness seemed to reassure investors, with Apple stock ending the day higher than it began, down just 2.5 per cent. Activists praised the decision by the usually tight-lipped Cook to email Cramer.
China is Apple's second biggest market after the Americas, with App Store revenue there alone growing more than 100 per cent in the past year.
Total Apple revenue from China for the second quarter of 2015 was US$16.82 billion, a 71 per cent increase year-on-year. Sales of the iPhone surged 87 per cent, despite research firms estimating the smartphone market only grew by around 5 per cent, demonstrating how the US firm has been able to dominate the high-end device segment in the world's second largest economy.
This week, it was reported that Foxconn, Apple's leading parts supplier, was hiring up to 100,000 workers in its China-based factories in preparation for the release of the latest iPhone model next month.