Apple’s discounts on the iPhone 11 in China and the release of a new low-price SE model have put the corporate in a better place than rivals to weather a coronavirus-related plunge in global smartphone demand.
While China, which accounts for approximately 15% of Apple’s revenue, seems to be a rare bright spot, investors shall be eager to get an image of global demand when the Cupertino, California-headquartered firm reviews second-quarter results on Thursday.
The iPhone manufacturer has shut retail stores in the U.S. and Europe following the COVID-19 pandemic, and China is the only main market where it has been able to reopen all shops.
Consumer spending is predicted to be muted as the pandemic has crippled economies, and Apple, the world’s second-most valuable tech firm, is better armed with the launch of its new price-conscious iPhone model, analysts mentioned.
The launch of the $399 iPhone SE suggested that Apple’s supply network was getting back on track after weeks of shutdown earlier this year.
Analysts expect Apple to report a 6% plunge in income and an 11% drop in net income in its fiscal second quarter, based on Refinitiv data.
However, Chinese manufacturers such as Oppo and Vivo, who’ve steadily moved to offer high-end models to challenge iPhones, stand to lose market share as discount hunters choose Apple.