Why AAPL stock didn’t rise on record iPhone sales: China sales more than nullified gains


With Apple having announced all-time record iPhone sales, you might have expected analysts and investors to be impressed, and to see the AAPL share price rise as a result. Instead, the stock is actually down a little – so what gives?

The answer, like the one to so many questions today, is: China. This is the first iPhone launch where mainland China, and not just Hong Kong, has been included from day one. This means the opening weekend sales of 13M versus 10M last year aren’t like-for-like.

Apple hasn’t revealed what percentage of iPhone sales were made in China, but we can do some back-of-an-envelope sums to get a rough idea … 

If we add together Apple’s Q2 and Q3 numbers, we can see that Apple’s revenue from China over that six month period totalled $30B out of a total of $107B – or a little over 28%.


We don’t know how that breaks down across products, but it’s a safe bet that China is buying more iPhones than iPads or Macs, so it seems reasonable to conclude that somewhere close to 30% of this year’s opening weekend iPhone sales were in China. But let’s stick with that 28% as an illustrative example.

Apple sold 13M iPhones worldwide in its opening weekend. Taking 28% of that number to be in China, that’s 3.64M. Take that from 13M and the like-for-like comparison with last year is 9.36M – a drop from last year’s 10M.

Let’s also keep in mind that city/SAR of Hong Kong WAS part of the iPhone 6 launch and that is a not-insignificant part of China, especially when you consider that a lot of folks bought in Hong Kong (and everywhere else) to take to China on opening weekend.

I’ll be the first to admit this is all very rough-and-ready number-crunching, but it’s still clear that there’s a big difference between Tim Cook’s gushing talk of “phenomenal” demand that saw iPhones sales “blowing past any previous first weekend sales results in Apple’s history” and the underlying reality which may be a little more tame.

That’s not to say that getting close to equalling last year’s record sales in an S year isn’t an impressive achievement – it is. Any company would be over the moon to announce sales of 13M over an opening weekend.  Last time there was pent-up demand for larger-screen iPhones, and this is an S-model year with the same sizes. But it does explain why the market isn’t rushing out to buy more AAPL stock in response. With the NASDAQ as a whole down 3%, Apple did effectively see a slight gain against the market, just not a dramatic one.

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  1. lkrupp215 - 7 years ago

    So the bottom line is as usual… Apple is Doomed™ Thanks 9to5Mac, I had forgotten that.

    • Seth Weintraub - 7 years ago

      Clearly that’s the point. Or maybe we’re trying to explain why analysts weren’t impressed by Apple’s ‘record’ numbers. Apple will be fine

  2. Jonny - 7 years ago

    Wasn’t the 5S launched in China as well?

    • Seth Weintraub - 7 years ago

      To all the people here and below comparing iPhone 5S – we’re comparing YoY not year over 2 years ago numbers. Yes, this is an S year but AAPL price doesn’t care.

      • Jonny - 7 years ago

        I’m not sure I’m correct, so I’m not looking to come across that way.. but IF this wasn’t the first time an iPhone was launched in China, why does the article say, “The answer, like the one to so many questions today, is: China. This is the first iPhone launch where mainland China, and not just Hong Kong, has been included from day one.”

      • mikhailt - 7 years ago

        Nobody cares, you are incorrect by saying it is the first iPhone launch to include China, it is really as simple as that. Stop making excuses and correct your misleading statement, which is also simple. Jesus.

  3. chrisl84 - 7 years ago

    Them pesky details behind the numbers

  4. Didn’t the 5S launch in China day one?

  5. zedman2 - 7 years ago

    I thought the China market was doomed and crashing! So based on the Markets “expert” analysis that we’ve had he past month, no one in China is buying expensive phones so really what you’re saying is “Other markets have stepped up and is outpacing last year”.

    • epicflyingcat - 7 years ago

      The Chinese stock market is crashing, no one’s saying the economy as a whole is, just slowing down. Plus, consumer spending is rising faster than economic growth in China right now as it modernises.

  6. tincan2012 - 7 years ago

    Analysts ALL knew that this weekend sales number would include China numbers and yet they predicted a smaller number. So IMO this is a very flawed interpretation of why AAPL dropped. Agree that Apple trades with the market (as a ‘beta’) generally, and as noted, the market is down. More importantly given the better than expected sales of iPhones, there were a lot of option traders who need AAPL to stay down to cover their positions. You have to know that the large funds can manipulate prices when they need to, but I hope AAPL won’t be down for long. Wall Street could be out of explanations for why AAPL is underperforming if they have great earnings report in a few weeks, but then again, there seems to be no lack of slimy tricks for these guys.

    • macnificentseven48 - 7 years ago

      There’s no end to reasons why Apple is down. Whatever the situation, they make up reasons on the fly. I don’t necessarily think a great earnings report will boost the share price because Apple has had good earnings earlier in the year and the share price still dropped. I believe the company has been put on the crap investment list because of Tim Cook’s attitude toward investors. I’m only guessing and fishing for reasons. Fundamentally, Apple is a sound company. Plenty of new retail stores opening and plenty of new hirings. The company definitely isn’t losing money. The stock buybacks have pushed the EPS much higher. Still nothing for shareholders. The big investors don’t seem to be interested in buying Apple stock at all. Whatever the reason, I’d sure like to see the situation change but don’t have a clue as to what will bring about that change.

      It is funny how the analysts claim Apple beat iPhone sales expectations, but the stock dropped and then they’re saying it’s still not enough for other various reasons. Their outlook suddenly changed over the weekend. It’s just plain weird the way they backtrack on their analysis a couple of days ago. I’ve basically given up on seeing any gains from Apple because it would seem everything Apple has tried has failed to move the stock upward. I can only hope Apple increases dividends to see any returns in the future from owning Apple.

  7. snoman4096 - 7 years ago

    To me it would seem that growth is growth. Isn’t 13 million units better than 10 million units, regardless of where the iPhone was sold. Apple has no doubt invested heavily into getting their products sold in China, which has paid off my allowing them to ship MORE iPhones. This is why Wall Street is so damn backwards. It doesn’t matter what actually happened for the iPhone launch…. What matters is the perception of the iPhone launch.

    • chrisl84 - 7 years ago

      No, because eventually you run out of “new” markets….just finding new places to sell isn’t growth its desperation.

      • snoman4096 - 7 years ago

        No, because they are still finding new markets, proven by a large uptick of sales in China. Plus, I’ve heard there may be life on Mars… So there’s always the Mars market to tap into…

  8. Jake Brennan - 7 years ago

    Three BIG takeaways (amongst many others) that people are forgetting to take into account here:

    1) the breakdown of iPhone 6s vs 6s Plus which will DEFINITELY show a big improvement in ASP over last year
    2) the fact that the iPhone 6 is now the discounted model
    3) even though China was not in one of the initial launch countries last year, MANY people in China (and around the globe) purchased their phones via “resellers”.

    Apple will probably be looking at around 10% YoY iPhone unit growth next quarter. With the new financing plans in the US and amazing carrier deals, as well as the discounted iPhone 6 – looks iPhones are all set for a good 2016.

  9. rogifan - 7 years ago

    iPhone 5S was launched in China on the first wave.

  10. Ben, the reason investors weren’t impressed is simply that Apple last week already hinted at record numbers. Looking back then the stock price rose. To expect further rise this week is to not understand how the stock market works. Stocks rise and drop because of rumors, not because of facts. This is just one example where the 13 million number was already rumored before it became official and because of that the stock market acted beforehand.

    Had Apple not hinted last week about record sales, the stock would have risen this week instead. As it stands now, no one expected anything less than 13 million.

    • Ben Lovejoy - 7 years ago

      There’s certainly truth in the ‘buy on the rumor, sell on the fact’ mindset, but worth noting that Apple said only that it was on track to beat last year’s record, it didn’t hint at the number – which is superficially impressive.

  11. Kelvin Lin - 7 years ago

    In my opinion, all these speculations/calculations are meaningless due to the simple fact that at the opening weekend the availability of iphones are supply constrained. Opening weekend sales number is not a good indication of the demand out there, it simply accounts how many iphones apple was able to produce (in an unknown time period before launch) and deliver. Let’s not forget that there are still millions of iphones that has been ordered but not yet delivered, and those are not counted towards the 13 million.

  12. rodgerrafter - 7 years ago

    The market was down significantly more than AAPL yesterday. If the news was having a strong impact, that impact was positive.

    In reality, news doesn’t drive the market as much as most people believe. Actions of the fed, large institutional traders, “technical” traders and the derivatives markets cause bigger short term swings. The financial media always looks for news items after the fact to explain the moves.

    • macnificentseven48 - 7 years ago

      Someone read your comment and Apple really got hammered today. I can understand Apple not going up after selling 13 million iPhones, but now it’s going down even faster. That’s somewhat hard for me to figure. Even as Apple makes more revenue and profits the stock is being sold off even faster and that’s despite even good analyst ratings. Even Hewlett-Packard isn’t being sold off like Apple is. Even Microsoft isn’t being sold off as fast as Apple is. Apple is becoming a terrible investment especially after flushing away well over a hundred billion dollars in stock buybacks. Scary business for Apple shareholders to simply watch Apple’s value fall away to nothingness for unknown reasons.

  13. mytawalbeh - 7 years ago

    The right explanation is that bunch of idiots running Wall Street, no matter how much iPhones were sold they’ll keep undervaluing AAPL stocks.
    Not news anymore.

  14. jonathanjk - 7 years ago

    Hong Kong is still busy here because of mainlanders regardless of first day launch in China. This is why I’m not getting my day 1, minute 1, pre-order until at least the 8th of October.

  15. 20-30% of all iPhones sold in the US last year on opening weekend were shipped to China. China day-and-date this year is completely moot. iPhone launch sales don’t now and have never driven AAPL stock price anyway – something only two other commenters mentioned.

    You guys are so busy looking for big trouble in little China that you miss the most important questions. Is Apple including first week pre-sales in their totals for this or any other year? There were 16 days this year from when pre-orders started until the end of the first weekend, while last year only 10. If pre-sales aren’t included, it stands to argue that those extra 6 days would account for some softness in direct store sales on the weekend.

    Not getting these points straightened out, along with considering their implications, is just negligent in any commentary regarding sales performance.

  16. freerange5 - 7 years ago

    Nice try but far off the mark for several reasons.

    1. Yes, many Chinese buy outside of China (Hong Kong and other markets) but that number is VERY significant. By buying in Hong Kong they save 17% so a significant number are in no rush to buy on day one. It’s not just black market sales either – they will wait to pick one up there themselves on their next trip, or have someone pick it up for them and bring it back.
    2. China does not have nearly the distribution points (Apple Stores) to handle massive first day sales in China.
    3. Supplies are virtually exhausted after opening weekend, now showing up to 3-4 week lead times! Demand far outstripped supply! Any prognostication about China is nothing more than mental masturbation

    This is going to be another record breaking blockbuster year for the iPhone. BTW – stock market analysts have their heads so far up their posteriors that when they blink, they tickle their throats.

  17. Neil Anderson - 7 years ago

    Apple had 13 million iPhones on hand and sold them all. If Apple could have made 14 million in time for the launch they would have sold 14 million and so on.

    • sewollef - 7 years ago

      THAT I can confirm since I have three friends who have ordered iPhone 6s and 6s Plus and been given late-October and even November delivery dates. Had they been in stock, they;d have been delivered this week or next.

    • epicflyingcat - 7 years ago

      Precisely. Apple’s strong fan-base means first weekend sales mean absolutely nothing.

  18. rnc - 7 years ago

    “analysts”, better say their actual name: sensationalists.

    Chinese buys give the same money to Apple.

    And for the Chinese launch, a number of European countries still don’t have the 6S yet!

  19. Adam Stein (@adamstein) - 7 years ago

    But but but… I thought weakness in China was the whole reason Apple stock was dropping in the first place? So I guess China is strong, but iPhone sales are weak. Or something.

  20. yojimbo007 - 7 years ago

    Bogus approach…
    So only growth in US is of importance? Not total Growth.

  21. Nicnac Paddywack - 7 years ago

    It’s down because Wall Street makes rules for AAPL that don’t apply to any other stock on the planet.

  22. What is the point of this article? First of all, Apple has always only ever counted a sale as a unit shipped (and then billed) to the customer. Last year Apple had 10 million available to ship over the first weekend. This year they had 13 million ready to go. The author has absolutely NO idea how many are on back order. The number of countries the iPhone was made available in has nothing to do with how many sold over the launch weekend. Even if it was launched in 100 countries, they STILL ONLY HAD 13 million to ship! China or not, they still would’ve sold all of them over this launch weekend.

  23. Matthew Chang - 7 years ago

    How many times was AAPL down for stupid reasons similar to this, and within a year it made new highs! Every time a new record was broke, AAPL went down as analysts always find a way to interpret the data WRONGLY!

    If history is any indication, a new high will be reached within a year. It has happened for the last 5 years or so. Now is a GREAT time to get in, when stupid analysis and the overall market is pessimistic. We will see Tim Cook & Co announcing more buy back soon, and without doubt AAPL will pick up sharply from there. I suspect smart investors aren’t concerned with the performance of AAPL, rather, the broad market is more of a concern.

    No matter how good the performance of a ship is, it can’t sail against the wind. When the tailwind comes, it will launch like a rocket!

  24. MrGutts - 7 years ago

    Well it looks like the annalists predicted correct for the Apple stock, 13 million does kind of sound impressive, but the problem is Apple cannot sustain those numbers and they cannot keep up with the demand. This has already happened many many times in the past with Apple. Great example, the next couple weeks, what Iphone 6s or Iphone 6s Plus units are they selling now? Not much because they don’t have any inventory and phones are back ordered 4 to 6 weeks out now. Wall Street does NOT like companies artificial product shortages for the sake of hype, Wall Streets knows this could have been avoided. That and well all stocks are just sucking anyway.


Avatar for Ben Lovejoy Ben Lovejoy

Ben Lovejoy is a British technology writer and EU Editor for 9to5Mac. He’s known for his op-eds and diary pieces, exploring his experience of Apple products over time, for a more rounded review. He also writes fiction, with two technothriller novels, a couple of SF shorts and a rom-com!

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