Do Strong Q2 Sales Numbers Signal an Apple Come Back?

Published On August 19, 2013 | Tech Business

Ever since the passing of Steve Jobs in 2011, the future of Apple has come into question. Many wonder if the tech giant will ever regain the once seemingly insurmountable lead over the competition. Strong Q2 sales may be an indication that the software giant is not dead yet, however, Apple’s place at the forefront of smart devices may remain on shaky ground.

Strong Domestic Sales

Largely thanks to the iPhone (Apple sold 26 million more iPhones than the same time last year), Apple managed to have strong Q2 sales. The strong Q2 sales helped encourage investors to raise Apple shares by 4 percent. Though iPhone sales were up, Apple’s combined Q2 sales basically left the company’s revenue flat when compared to the same time last year. Despite nearly flat revenue, Apple’s gross of $35.3 billion beat expectations, however, by a slim margin.

Sales May Continue to Climb After the Fall Season

Because Apple has traditionally presented new releases in the fall, the summer months of the third quarter tend to be slower for the company as consumers wait for the next best thing, which means Apple may continue to see flat revenue throughout the remainder of the summer.

Sales Are Down in Overseas Markets

Apple has recently seen a decrease in sales in once thriving overseas markets, China specifically being a problem. Despite sales of iPads being up, overall sales in the Chinese market are down 4 percent in comparison to the same quarter last year and even more so in Hong Kong at a whopping 20 percent decrease. Apple’s chief executive, Timothy D. Cook, remains hopeful that China is still a huge market opportunity for Apple as more than a half a million people in China create apps for Apple’s iOS software, a number which could translate to more sales.

Apple’s Competitors are Gaining Ground

When Apple released the first iPhone in 2007, there was nothing else like it on the market. Times have changed and Apple now has many viable competitors. Competitors like the Samsung Galaxy are closing in on Apple by offering larger screens, more RAM, and better cameras. Many think Apple’s best chance to beat out the competition is to gain a strong foothold in foreign markets before the competition can steal the market away.

Consumers May be Losing Interest Waiting for the Next Big Thing

It has been years since Apple has released a “game changer” and most are doubtful the fall will bring anything revolutionary from the company. Apple could lose ground, and cool factor, as competitors clamor to create the next big thing. Google could be set to dethrone Apple with the much buzzed about Google Glass and initial success of Chromecast sales. Chromecast could force Apple’s hand as it offers the same functions as AppleTV at over $100 less in price.

It remains to be seen whether strong Q2 sales mean Apple is regaining ground but without new, innovative products, it will surely be difficult to maintain the upwards trend.

— By Stephanie Willingham

Stephanie Willingham is a contributing writer for a variety of industry blogs. She has professional experience in the medical and financial fields.

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