Can Apple’s growth in China resume via a new application accelerator?

by bold-lichterman

Apple seeks to develop its services activities in China: the apple brand has opened a design and development accelerator in Shanghai. It is intended to support local developers in the creation of applications on iOS.

China, still a key market for Apple

Once Apple’s world market, ahead of the United States and Europe in terms of iPhone sales, China has gradually declined in the company’s financial results from the second quarter of 2016, before stagnating at the end of the year. 2017 and then take off again in 2018. But in early 2019, the Cupertino company found itself in a delicate situation in China, the country where it manufactures most of its products. IPhone sales were in significant decline there – as they were across the world at the end of 2018 – and uncertainties related to trade tensions between the United States and China were affecting the economy. Apple had therefore taken the rare decision to lower its forecast for quarterly sales.

China continues to be a key market for Apple, however. Today, the company records nearly 18% of its turnover there. Apple claims to have 2.5 million developers in Greater China. The opening of a design and development accelerator in Shanghai could allow them to create better quality applications. And thus to stimulate Chinese spending on the App Store and in the brand’s products, possibly including the iPhone. Apple says it has already started holding conferences, seminars and networking sessions for developers.

Apple full steam ahead in services

In May 2016, Apple opened a development and acceleration center dedicated to mobile applications in India for developers. The objective was to directly capture a cheap workforce to accelerate the development of its Swift language for iOS.

Apple’s revenue from its services could jump in the third quarter of its staggered fiscal year, thanks in particular to its application store and the resumption of growth in China, according to Evercore ISI. The App Store is a major driver of Apple’s service business. The division had sales of $ 37.1 billion last year. Earlier this year, the company headed by Tim Cook jumped into services, with Apple TV +, News + and the Apple Card.