Jessica Goodfellow
Oct 29, 2021

Apple says it earned nearly one-third of 2021 revenue from emerging markets

Technology giant said it has doubled its business in India and Vietnam over the past year and recorded an 83% surge in sales from Greater China in its fourth quarter.

Apple's flagship store at Lujiazui Shanghai, China (Shutterstock)
Apple's flagship store at Lujiazui Shanghai, China (Shutterstock)

Apple told investors it is "optimistic about the future" after it earned nearly one-third of its fiscal 2021 revenue from emerging markets. CEO Tim Cook referenced the company's success in markets like India and Vietnam, where it "doubled" its business in the year, amid a disappointing quarter for hardware sales as the company was impacted by the ongoing chip shortage.

The company posted quarterly revenue of $83.4 billion, up 29% year-on-year, but still short of analyst predictions of $84.85 billion.

During an earnings call on Thursday (October 28), Cook said the company was impacted by "larger-than-expected" supply constraints, which it estimates had a $6 billion impact on the company's revenue. This was primarily driven by industry-wide silicon shortages and "Covid-related manufacturing disruptions in Southeast Asia", he said.

Chief financial officer Luca Maestri said the company expects the impact to be larger during the December quarter, especially for its iPads.

Net sales of iPhones, Macs and Wearables in the three months ended September 25 all fell short of analysts' expectations. Revenue generated from iPads and Apple's services business, which includes the App Store and Apple Music among others, surpassed expectations, up 21% and 26% compared to the same quarter last year.

Shares slid by 5% following the earnings announcement.

Apple Q4 2021 key stats

Net revenue: $83.36 billion
Net income: $20.55 billion
iPhone revenue: $38.87 billion
Mac Revenue: $9.18 billion
iPad Revenue: $8.25 billion
Wearables revenue: $8.79 billion
Services revenue: $18.28 billion

Still, the company said it set quarterly records in every geographic segment, with strong double-digit growth across the board.

The Americas continues to account for the lion's share of sales, at $36.8 billion in the quarter, a 20% increase year-on-year.

But growth was highest in Greater China, which shot up a whopping 83% to $14.6 billion. The company's 'Rest of Asia-Pacific' region, grew by 26% to $5.2 billion, Europe grew by 23% to $20.8 billion, while Japan recorded the lowest growth of 19% to $6 billion.

Apple has rolled out several initiatives over recent years to reduce its reliance on saturated developed economies, including discounting its products in China, developing a low-priced iPhone and expanding its services businesses to developing countries, principally in Africa and Asia. 

In the 12 months ended September 25, Apple reported $366 billion of revenue, representing 33% annual growth.

Consumer feedback on ATT is 'overwhelmingly positive'

Apple was quizzed on the feedback it has received from the shift to opt-in tracking it institued in iOS 14, which has had an impact on the advertising revenues of tech giants Google, Facebook and Snap in the most recent quarter.

Cook responded that the company's only motivation in the IDFA shift was to provide users with greater controls and added that feedback from customers "is overwhelmingly positive".

"Customers appreciate having the option of whether they want to be tracked or not," he said. "And so, there’s an outpouring of customer satisfaction there on the customer side."

Apple has rolled out more and more features over time to place the decision of whether to share data, and what data to share, in the hands of the user, Cook continued. "We don’t think that’s Apple’s role to decide, and we don’t think that’s another company’s role to decide, but rather the individual who owns the data itself. And so, that’s our motivation there. There’s no other motivation."

Chinese gaming restrictions for kids

The tech giant was also asked whether it had been affected by new regulations in China that require companies to impose time limits on gaming for children.

Cook said it is "very difficult to measure" the impact on the App Store at this point.

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