Analysts: Apple Must Target China, Issue New Products to Sustain Growth
Apple must train its sight to the East, experts said, if it wishes to sustain its record-breaking results and deflect predictions that the tech titan would falter sooner or later minus the introduction of innovative products, which marked the reign of Steve Jobs.
Two quarters after the departure of Mr Jobs, Apple has managed to turn in sterling results and defy critics' suggestion that without the iconic Apple co-founder, the company will eventually go the way of its fiercest nemesis, Microsoft, which conquered the tech and business world in most of the 1990s.
The software giant then found itself grappling in the following decade, stumbling on Windows Vista in mid-2000s that saw hordes of Windows babies migrating to Apple's Mac desktop and notebook computers.
By 2007, Apple successfully introduced strings of hit gadgets - mainly the iPad and the iPhone - that led to its ascension as the most valuable company in the world in March 2012, a feat that Microsoft had achieved more than a decade ago.
On its latest report, Apple revealed that its sold more than 35 million iPhones and close to 12 million iPads in the March quarter, en route to a Q2 revenue of $US39.2 billion.
Its net, the company said on a conference call this week, amounted to $US11.6 billion in the same quarter, nearly doubling the tech giant's haul of $US6 billion in same period last year.
Prior to the latest results, Apple lost about $US78 billion of its market value over the past two weeks as its market shares declined by 13 percent, Reuters said, but the big numbers that Apple CEO Tim Cook read out this week effectively soothed the concerns reportedly gripping the company's investors.
As of Wednesday's closing, Apple stocks hovered from $US610 to $US618 per share or traction gains that range in the vicinity of eight to 10 percent, according to Reuters.
The blockbuster results, however, failed to fan out fears that Apple could be drying out in the innovation market, with the past two years mostly characterised by the company's tendency to merely issue upgrades of its existing flagship products.
The drop-jaw reactions that Mr Jobs used to get on previous Apple product launches have long been absent, tech experts noted, which indicated that only iterations of the popular Apple devices have been hitting the global market lately.
But they continued to deliver billions for Apple, with its cash reserve upgraded by the latest haul to about $110 billion.
Analysts warned that Android fast catching up on the iOS and in fact, Samsung is presently regarded as the top smartphone vendor in the world, with its various lines of entry-level and high-end mobile handsets luring various market divisions.
Apple remains focused on milking its existing market but such tactic could backfire on the American firm over the long haul.
To preserve its current status and to ensure further growth, Apple needs to walk the talk of Mr Cook, that is to gain more understanding of the Chinese market, the expert said.
Apple admitted that 20 per cent of its latest results were attributed to total sales that the company recorded in China by the end of March, leading to overall revenues of more than $US12 billion in the past two quarters.
Apart from its dominance in the North American and some parts of the European markets, Apple's standings would be further boosted if the company could secure a deal with China Mobile.
Reuters reported that the Chinese telco's latest subscriber numbers were estimated to have breached the 660 million mark this year, making the firm the largest in the world in terms of existing customer base.
Accessing even half of that base would definitely shoot up further Apple's future earnings results, but observers stressed that the company must follow trough on its success with new products that again would convince consumers that they cannot live without them.
The best candidate so far is the Apple TV, according to research firm Gartner, which could be the new toast of the world, especially those of China's increasingly affluent consumers.
With the TV carrying the right price and features that would elicit awes across the globe, Gartner said that "the opportunity is there (for Apple) to maintain its growth or at least not to see an immediate drop in sales."