Bloomberg: iPhone China shipments grew 18.7% in December

From “iPhone Hits Double-Digit Growth in China, Official Data Show” posted Thursday:

Apple bagged a significant smartphone shipment jump in China last month as the world’s largest consumer electronics market heads into its holiday season, official data indicate.

The iPhone maker’s shipments in China grew 18.7% year on year in December to roughly 3.18 million units, according to Bloomberg calculations based on government data on overall and Android device shipments. The increase marked an acceleration from the prior months, which were buoyed by the iPhone 11’s release in September. The numbers come from the China Academy of Information and Communication Technology, a government think tank.

My take: First sighting of the monthly non-Android shipment data that all the analysts track. I can’t doublecheck Bloomberg’s calculations, but the analysts will.

UPDATE: From Wedbush’s Daniel Ives…

Earlier this morning it was reported that iPhone growth in China during the month of December grew 18% year over year, which is ~200 bps above our expectation and ahead of what the Street was currently modeling. Data from the China Academy of Information and Communication Technology indicates Cupertino shipped ~3.2 million smartphones in December vs. 2.7 million a year ago as China remains the key region going forward in the Bull/Bear debate. This news only furthers our positive bullish thesis on Apple heading into 2020 given our recent positive Asia checks, 5G technology/upgrades around the corner, and our belief that China will continue this positive upward trajectory with renewed growth and share gains on the heels of an iPhone 11 product cycle which the skeptics continue to underestimate.

UPDATE 2: From Evercore’s Amit Daryanani…

All You Need to Know: MIIT published data for the Chinese smartphone market that shows iPhone sales grew ~19% in December. The robust performance is encouraging and should help alleviate concerns about China especially after MIIT reported a 35% drop in iPhone sales for November. Notably, the strong iPhone performance came despite a 14% decline in the broader market. iPhone sales will likely continue to accelerate in China as we approach the Chinese New Year at the end of January. Investors are likely paying close attention to Chinese iPhone sales given concerns around how Apple’s lack of a 5G model will affect its competitiveness in the region. Net/net: The data is encouraging especially when you consider the concerns around the lack of a 5G iPhone. Maintain OP and $315 target.

4 Comments

  1. Gianfranco Pedron said:

    Hey, good news is good news but they’re still counting units. Sounds like Bloomberg hasn’t gotten the memo about services, etc.

    Maybe Bloomberg should give Toni a call and find out how he’s doing these days.

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    January 9, 2020
  2. Turley Muller said:

    This is good news. NOV was down and analysts freaked out, but the XR was released late last year, while all iPhones this shipped in SEP. It’s a good number because it shows iPhones are selling through- when DEC last year they weren’t.

    iPhone units definitely grew in Q1. May not show up in the revenue number due to differences in ASP and the portion of iPhone revenue Apple will defer and recognize in Services for the Apple TV+ promotion.

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    January 9, 2020
  3. Kathy Corby said:

    I am curious as to how that deferred revenue will affect the total revenue in the earnings report. Also, whether the analysts will be able to see through and discount that deferral. Does anyone have any perspective on this?

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    January 9, 2020
    • Turley Muller said:

      @ Kathy, the deferral will lower total revenue in the short-run, but increase it in later quarters as it is recognized— moves off the balance sheet into the income statement. We’ll know about how much is deferred from the disclosures in the 10-Q.

      Anybody’s guess as to how the analysts will react. I don’t think the impact will be that big.

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      January 9, 2020

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